About the scheme
- Pradhan Mantri Mudra Yojana (PMMY) is a flagship scheme of Government of India to “fund the unfunded” by bringing such enterprises to the formal financial system and extending affordable credit to them.
- Launched in 2015 to promote entrepreneurship, PMMY provides loans upto Rs. 10 lakh to the non-corporate, non-farm small/micro enterprises.
- Under PMMY collateral free loans of upto Rs. 10 Lakh are extended by Member Lending Institutions (MLIs) viz Scheduled Commercial Banks, Regional Rural Banks (RRBs), Small Finance Banks (SFBs), Non Banking Financial Companies (NBFCs), Micro Finance Institutions (MFIs) etc.
- The loans are given for income generating activities in manufacturing, trading and services sectors and for activities allied to agriculture.
- Mudra loans are offered in three categories namely, ‘Shishu’, ‘Kishore’ and ‘Tarun’ which signifies the stage of growth or development and funding needs of the borrowers:-
- Shishu : covering loans upto Rs. 50,000/-
- Kishore : covering loans above Rs. 50,000/- and upto Rs. 5 lakh
- Tarun : covering loans above Rs. 5 lakh and upto Rs. 10 lakh
- With an objective to promote entrepreneurship among the new generation aspiring youth, it is ensured that more focus is given to Shishu Category loans and then Kishore and Tarun categories.
Why in News?
- As per data uploaded by Member Lending Institutions (MLIs) on Mudra portal, as on 27.01.2023, more than 38.58 crore loans have been extended since inception of the Scheme in 2015.
- Out of this, over 26.35 crore loans have been extended to Women Entrepreneurs (68%) and 19.84 crore loans to SC/ST/OBC category of borrowers (51%).
- PMMY helped in generating 1.12 crore net additional employment in the country during a period of approximately 3 years (i.e. from 2015 to 2018).