Pradhan Mantri MUDRA Yojana (PMMY)

What is it?

PMMY channels small business credit to people who normally fall outside formal bank lending: shopkeepers, vendors, service providers, small manufacturers and transport operators. Loans are given without collateral, and you deal directly with a lending institution rather than with MUDRA itself.

Lending is organised into stages that track how established the business is. Shishu covers the smallest first loans, Kishor a business finding its feet, and Tarun enterprises that are scaling up. A fourth tier added in 2024 rewards borrowers who have already repaid a Tarun loan by opening access to a higher limit.

MUDRA Ltd does not lend to individuals. It refinances and supports the banks, regional rural banks, small finance banks, non-banking finance companies and microfinance institutions that actually make the loans.

Potential benefit

₹50,000 – ₹20,00,000 loan amount

Collateral-free loans in four tiers: Shishu up to Rs 50,000, Kishor above Rs 50,000 to Rs 5 lakh, Tarun above Rs 5 lakh to Rs 10 lakh, and Tarun Plus above Rs 10 lakh to Rs 20 lakh for borrowers who have repaid a previous Tarun loan. Sanction is at the lender's discretion.

Who can apply?

• You run a business or want to start one

  Where this comes from

  providing loans up to 10 lakh to the non-corporate, non-farm small/micro enterprises

  Official source ↗
• Age 18 or above

  Where this comes from

  non-corporate, non-farm small/micro enterprises

  Official source ↗
• Your situation fits the kind of enterprise the scheme funds improves your chances rather than being required

  Where this comes from

  non-corporate, non-farm micro and small enterprises

  Official source ↗

Other conditions stated by the government

• The business must be a non-corporate, non-farm micro or small enterprise in manufacturing, trading, services or activities allied to agriculture.
• The Tarun Plus tier of Rs 10 lakh to Rs 20 lakh is open only to borrowers who have already repaid a previous Tarun loan.
• No age limit, income limit, gender rule, caste rule or rural/urban rule was found on any official source.

Eligibility information is provided for informational purposes only. Final eligibility and approval are determined by the relevant government authority.

Documents you will need

We have not been able to confirm the document list from an official source, so we have left it out rather than guess. Check the official source linked above.

How to apply

Approach any participating bank, regional rural bank, small finance bank, non-banking finance company or microfinance institution directly, or apply online through a government credit portal. MUDRA itself does not lend and does not use agents or intermediaries. The lender assesses your proposal and sanctions under the appropriate tier.

Where to apply: online and bank

Deadline

No fixed deadline. Applications are accepted on a rolling basis.