Mudra loan for women is one of the major initiatives by the Government of India. The purpose behind this scheme is to uplift the Micro, Small and Medium Enterprises (MSMEs) in India. Mudra loan was launched on 8th April 2015 to support small businesses across India.
The loan scheme aims at creating a smooth credit delivery and recovery system. It also encourages banks to use Good Credit recovery methods and create a healthier system.
Micro-Units Development and Refinance Agency (MUDRA) loan is an initiative for the upliftment of the MSMEs. Mudra is an owned subsidiary of Small Industries Development Bank of India (SIDBI).
SIDBI is responsible for working towards developing and refinancing SME units. Mudra Loan scheme is under the Pradhan Mantri Mudra Yojana (PMMY) and it offers loan schemes in three categories- Shishu, Kishor and Tarun schemes.
An applicant doesn’t require Collateral security or third-party guarantor while applying for a Mudra loan. However, the criteria for application varies from one bank to another. Applicants will need to check with the desired bank and their application requirements before applying for the loan.
It is also important to note that not all banks offer Mudra loans. However, banks that fall under the eligibility criteria of the Pradhan Mantri Mudra Yojana (PMMY) from both private and public sectors along with regional-rural banks, scheduled urban co-operatives, state co-operatives, will offer the loan.
The recent Aatmanirbhar Bharat Abhiyan (Self-reliant India Scheme) has brought in certain benefits for the Mudra loan Shishu category.
The interest rates under the Mudra loan depends on the applicant’s profile and needs of the enterprise. However, it is also subject to the bank the applicant is applying to. The tenure for a loan under all the three categories is up to 5 years.
Here are the top 5 banks that provide Mudra Loan for Women. Check the interest rates for 2020 mentioned below:
|Bank||Loan Amount (INR)||Interest Rate (%)|
|State Bank of India (SBI)||Rs. 10 lakhs||10.15% onwards|
|Bank of Baroda (BOB)||Rs. 10 lakhs||9.65% onwards+SP|
|Bank of Maharashtra||Rs. 10 lakhs||8.70% onwards|
|Andhra Bank||Rs. 10 lakhs||10.40% onwards|
|Corporation Bank||Rs. 10 lakhs||9.30% onwards|
SBI provides a maximum loan amount of Rs. 10 lakhs. The repayment tenure is up to 5 years. The processing fees are nil for the Shishu loan scheme. The interest rate for all three categories starts from 10.15% onwards.
The Bank of Baroda offers a loan amount of Rs. 10 lakhs. The repayment tenure is up to 5 years. The processing fee is NIL for all three categories. The rate of interest starts from 9.65% onwards along with Strategic premium.
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The Bank of Maharashtra provides a loan amount of Rs. 10 lakhs. The repayment tenure is up to 5 years. The processing fee depends on the applicant’s profile. The rate of interest starts from merely 8.70%.
The Andhra Bank provides a loan amount of Rs. 10 lakhs. The repayment period is up to 5 years. The processing fee has a 50% concession. The rate of interest starts at 10.40% onward.
The Corporation Bank offers a loan amount of Rs. 10 lakhs. It offers a repayment tenure of up to 7 years. The processing fee depends on the applicant’s profile. The rate of interest starts at 9.30% onward
Three different categories of Mudra Loans are explained below:
Under this category, the applicant can apply for a loan of up to Rs. 50,000. This is targeted toward small start-ups. The applicant has to present their business idea while applying for this loan. This will decide whether they would be eligible for the loan sanction.
Under this category, the applicant can apply for a loan of Rs. 50,000 to Rs. 5 lakhs. This is targeted toward those with an established business, but wishes to set a strong base for it. The applicants are required to present all relevant documents to showcase the current position of their company.
Under this category, the applicant can apply for a loan of up to Rs. 10 lakhs. This targeted toward those with an established business, but are looking for expansion. The applicant will have to show related documents to get the loan approved.
The following institutions are eligible for providing Mudra Loans:
Following are the necessary criteria to be eligible for a Mudra loan:
Applicants applying Mudra loan should be between the age group of 18 years and 65 years.
Applicants should be any one of the following:
The following documents are required while applying for Mudra loan-
Mudra loan is tailored for helping businesswomen, vendors, shopkeepers and others. The loan money should be directed toward the working Capital and purchase of equipment or transport facilities.
Women working with tiffin services, street-side food stalls, cold storage, catering services are eligible to apply for the loan.
Women dealing with the handloom sector, fashion designing, khadi work and other textile work can apply for the loan.
Women working as shopkeepers and vendors are also eligible for applying for this scheme.
Women dealing with dairy farming, livestock rearing, poultry farming, and other activities can also apply for this loan.
Applicants can avail the Mudra card after loan approval. The bank opens a loan account for the applicant and the set amount is disbursed into the account. The applicant can then debit the amount through the Mudra Debit Card. This is helpful in keeping a track record of the applicant’s credit history.
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Read all the scheme related documents carefully from your desired bank before applying for the loan. Present all necessary documents and other bank requirements before applying.