PM MUDRA Loan: How to Apply
In this guide
Step-by-step Process
Understand MUDRA Loan Categories
MUDRA loans have three tiers: Shishu (up to ₹50,000) for startups and micro enterprises, Kishore (₹50,001–₹5 lakh) for expanding businesses, and Tarun (₹5 lakh–₹10 lakh) for well-established businesses. A new Tarun Plus category (up to ₹20 lakh) is available for borrowers who have repaid a Tarun loan.
Check Eligibility
MUDRA loans are for non-farm income-generating activities: manufacturing, trading, and services. Eligible entities include individuals, proprietorships, partnerships, and small companies. No minimum credit score is required for Shishu loans, making them accessible to first-time borrowers.
Prepare a Business Plan
For Kishore and Tarun loans, prepare a brief business plan: business description, investment requirement, expected revenue, and repayment plan. For Shishu, a simple statement of purpose is sufficient. Free templates are available at udyamimitra.in.
Apply at Bank or Udyamimitra Portal
MUDRA loans are disbursed through all scheduled commercial banks, RRBs, MFIs, and NBFCs. Apply in person at the nearest branch or online at udyamimitra.in. Fill the MUDRA application form and submit documents.
Receive Loan and MUDRA Card
Upon approval the loan amount is credited to your business account. For working capital, you receive a MUDRA RuPay card linked to an overdraft account. Repayment tenure: up to 5 years. No collateral or third-party guarantee required.
Documents Required
- ✓Aadhaar card and PAN card of applicant
- ✓Proof of business address (utility bill, rent agreement)
- ✓Business registration proof if applicable (Udyam certificate, GST)
- ✓Last 2 years ITR and balance sheet (Kishore and Tarun only)
- ✓Passport-size photographs
Official Government Portals
Common Questions
Is there any subsidy on MUDRA loans?
MUDRA loans are not subsidised — they carry market-linked interest rates. Their key benefit is being collateral-free. Some state governments offer additional interest subvention for women and SC/ST borrowers. Check your state MSME department for state-specific schemes.
Can I get a MUDRA loan for agriculture?
MUDRA loans are for non-farm activities. However, allied activities such as food processing, dairy, poultry, and agri-trading do qualify. For direct agricultural loans, apply under the Kisan Credit Card (KCC) scheme.
What is the interest rate on MUDRA loans?
Rates are set by individual lenders. Shishu loans typically range 10%–12% p.a., Kishore 12%–15%, and Tarun 14%–17%. MFIs may charge higher rates. Always compare offers from multiple lenders before accepting.
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