How to Obtain a Mudra Loan and Who Can Benefit from It?

The Indian government has introduced various schemes to support its citizens, particularly those interested in starting or expanding their businesses. One of the key initiatives launched by the government in 2015 is the Pradhan Mantri Mudra Loan Scheme. This scheme aims to provide financial assistance to entrepreneurs and small business owners, helping them establish and grow their ventures. Here’s a comprehensive overview of the Mudra Loan Scheme, including its types, eligibility criteria, and application process.
Types of Mudra Loans
The Pradhan Mantri Mudra Loan Scheme offers three types of loans, each catering to different stages of business development. The loan amounts and their respective categories are as follows:
- Shishu Loan: Up to ₹50,000. This loan is ideal for those starting a new business.
- Kishor Loan: Ranges from ₹50,000 to ₹5 lakh. Suitable for businesses that are in the expansion phase.
- Tarun Loan: Ranges from ₹5 lakh to ₹10 lakh. For well-established businesses looking for further growth. Notably, the Tarun loan amount can be increased up to ₹20 lakh for those who have repaid their previous loans on time.
Eligibility Criteria for Mudra Loans
To qualify for a Mudra loan, applicants must meet certain eligibility requirements:
- Age Requirement: Applicants must be at least 18 years old.
- Credit History: The applicant should not be declared a defaulter by any bank or financial institution and must have a good credit score.
- Business Knowledge: The applicant should have relevant knowledge and experience related to the business for which the loan is being applied.
- Usage of Loan: The loan must be used exclusively for business purposes.

How to Apply for Mudra Loans
Applying for a Mudra loan is a straightforward process that can be completed online. Follow these steps to apply:
- Visit the Official Website: Go to www.mudra.org.in, the official portal for the Mudra Loan Scheme.
- Select the Loan Type: On the homepage, choose from the three loan options: Shishu, Kishor, or Tarun, depending on your business needs.
- Download the Application Form: Click on the link to download the application form for the chosen loan type. Print the form.
- Fill Out the Form: Complete the form with all required details. Ensure that you attach all necessary supporting documents.
- Submit the Form: Submit the filled application form and supporting documents to your nearest bank branch.
- Approval and Disbursement: Upon approval of your application, the loan amount will be disbursed to you.