Pradhan Mantri Mudra Yojana – An Outline

September 6, 2018by Team CapitaWorld0


Pradhan Mantri Mudra Yojana (PMMY) scheme was launched on 8 April, 2015 for providing loans to non-farm small/micro enterprises & non-corporates.

The PMMY loans will be sanctioned & disbursed with the help of 194 institutions which includes – Public Sector Banks (27), Private Sector Banks (18), Co-operative Banks (14), Regional Rural Banks (31), Non-Banking Finance Companies (30+), Micro Finance Institutions (26) and other financial institutions.

(Source: Official Website Click to download the complete list of Partner Lending Institutions. The list of lending institutions is indicative as on the date of the article published and revised periodically.)


Micro Units Development and Refinance Agency Ltd (MUDRA) provides refinance support for the development of micro enterprises in the country.

Under the aegis of PMMY, three products have been created by MUDRA – namely ‘Shishu’ (60% Share), Kishor and Tarun (40% share jointly). These Products cater to funding needs of units at various stages of growth/ development.


The funding support will be in form of:

  1. – Loan Portfolio Securitization
  2. – Women Enterprise Programme
  3. – Micro Credit Scheme for loans up to Rs 1 lakh
  4. – Refinance Scheme for Scheduled Co-operative Banks / Commercial Banks / Regional Rural Banks

Eligibility Criteria

Any Indian Citizen who has a business plan (other than farming activity) for manufacturing, trading, processing, or service sector will be funded. The credit requirements must not exceed the limit of Rs 10 lakhs.

(Note: The regular credit policy parameters have to be followed for loans which are given under PMMY. The lending rates will be dependent upon the RBI guidelines).


Mudra loan is extended for a variety of purposes such as:

  1. – Business Loan
  2. – Equipment Finance
  3. – Working Capital Loan
  4. – Transport Vehicle Loans

Various activities such as Transport Vehicles, Community, Social & Personal Activities, Food Products, Textile Activities and such other Micro units are covered under MUDRA Loans.


The card was introduced to extend the working capital facility to deficient units. It is issued against MUDRA loan account and can be used across the country for withdrawal of cash from any ATM. Moreover, National Payment Corporation of India (NPCI) is tracking all the MUDRA Card transactions to create a credit history for borrowers.

Scheme Performance

As per Government data, Under Pradhan Mantri Mudra Yojana (PMMY) as many as 3.49 crore new enterprises had benefited between 2015-16 to 2017-18. About 12.27 crores number of loans were sanctioned during this period. From below chart, you can understand that this scheme has come a long way since its inception.



18 August 2018
Is There Bang For The Mudra Buck?

27 March 2018
Mudra scheme: Smoke and mirrors

01 February 2018
PM MUDRA Yojana in 2018-19: Jaitley allocates Rs 3 lakh crore for lending under Mudra

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