PM Mudra Loan : In recent years, government-backed loan schemes have become a lifeline for budding entrepreneurs and small businesses. One such revolutionary initiative is the Pradhan Mantri Mudra Yojana (PMMY). With the government now pushing digital accessibility, applicants can now apply for a Mudra Loan of up to ₹10 lakh completely online—from the comfort of their homes. This move simplifies the loan process and empowers citizens to achieve their business dreams with minimal hassle.
PM Mudra Loan : What is the PM Mudra Loan Scheme?
The Pradhan Mantri Mudra Yojana (PMMY) is a flagship scheme launched by the Government of India to provide financial support to micro and small enterprises. Under this scheme, borrowers can avail loans up to ₹10 lakh without needing any collateral. The objective is to encourage entrepreneurship, promote self-reliance, and support small-scale industries.
Mudra loans are mainly offered under three categories:
- Shishu: Loans up to ₹50,000
- Kishore: Loans ranging from ₹50,001 to ₹5 lakh
- Tarun: Loans from ₹5 lakh to ₹10 lakh
Each category targets businesses at different stages of growth.
Key Benefits of PM Mudra Loan
Applying for a Mudra loan online has become more user-friendly and efficient in 2025. Here are the standout benefits:
- No Collateral Required: Borrowers don’t need to pledge any security.
- Quick Online Application: Apply easily through the Mudra portal or partner bank websites.
- Low Interest Rates: Interest rates are competitive and affordable.
- Flexible Repayment Options: Repayment tenure varies based on loan amount and business type.
- Government Support: Backed by the Indian government for security and assurance.
- Credit Guarantee: Ensures the lender is protected, encouraging faster loan approvals.
Who Can Apply for a Mudra Loan?
This scheme is open to a wide range of individuals and business owners, including:
- Small manufacturing units
- Artisans and skilled tradesmen
- Shopkeepers and traders
- Food vendors and service businesses
- Women entrepreneurs
- Start-ups and new business ventures
Eligibility Criteria for PM Mudra Loan
To successfully apply, you must meet the following requirements:
- Must be an Indian citizen aged 18 to 65 years
- Should own a non-farm income-generating activity
- Must not be a defaulter with any bank or financial institution
- The business must fall under micro or small enterprises
- Should possess a business plan with projections for growth and income
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Documents Required for Online Application
Ensure the following documents are ready before starting your application:
- Identity proof (Aadhaar card, PAN card, voter ID)
- Address proof (utility bills, ration card)
- Business proof (registration certificate, business plan)
- Bank statements (past 6 months)
- Passport-size photographs
- Income tax returns (if applicable)
Step-by-Step Process to Apply for PM Mudra Loan Online
Applying for a Mudra loan online is a smooth process if you follow these steps:
- Visit the official Mudra portal or your preferred bank’s website.
- Select the loan type (Shishu, Kishore, or Tarun).
- Fill in the application form with correct personal and business details.
- Upload the required documents in the specified format.
- Submit the application and note your application number.
- Wait for verification and follow up with your bank.
- Upon approval, the amount will be disbursed to your account.
Mudra Loan Types and Benefits Table
| Loan Category | Loan Amount | Ideal For | Interest Rate (Approx.) | Repayment Tenure | Collateral Required | Processing Fees |
|---|---|---|---|---|---|---|
| Shishu | Up to ₹50,000 | Startups, first-time borrowers | 8% to 12% | Up to 5 years | No | Nil |
| Kishore | ₹50,001 – ₹5 lakh | Growing small businesses | 9% to 13% | Up to 7 years | No | Minimal |
| Tarun | ₹5 lakh – ₹10 lakh | Expanding enterprises | 11% to 14% | Up to 7 years | No | As per lender |
List of Banks Offering PM Mudra Loans Online
Here are some top banks and financial institutions offering Mudra loans digitally:
| Bank Name | Type of Loan Offered | Online Application Facility | Customer Care Number |
|---|---|---|---|
| State Bank of India | Shishu, Kishore, Tarun | Yes | 1800 11 2211 |
| Punjab National Bank | All Categories | Yes | 1800 180 2222 |
| HDFC Bank | Shishu, Kishore | Yes | 1800 202 6161 |
| ICICI Bank | Kishore, Tarun | Yes | 1860 120 7777 |
| Bank of Baroda | All Categories | Yes | 1800 102 4455 |
| Canara Bank | Shishu, Kishore | Yes | 1800 425 0018 |
| Axis Bank | Tarun | Yes | 1800 419 5959 |
| Union Bank of India | All Categories | Yes | 1800 208 2244 |
How is Mudra Loan Different from Other Business Loans?
Here’s a quick comparison between Mudra Loan and conventional business loans:
| Feature | PM Mudra Loan | Traditional Business Loan |
|---|---|---|
| Collateral | Not required | Often required |
| Interest Rate | Lower, subsidized | Varies, usually higher |
| Government Backed | Yes | No |
| Target Audience | Micro & small units | Medium to large enterprises |
| Application Process | Simple & online | Lengthy, sometimes offline |
| Processing Time | Fast | Moderate to slow |
Common Mistakes to Avoid While Applying
To improve your chances of quick approval:
- Don’t provide false or incomplete information
- Avoid submitting unclear or mismatched documents
- Refrain from applying without a clear business plan
- Don’t ignore follow-ups or verification calls/emails
- Ensure your credit history is clean
FAQs About PM Mudra Loan
Q1: Can I apply for multiple Mudra loans?
A: You can apply again under a different category as your business grows, but only one loan is approved at a time.
Q2: Is there any subsidy under this scheme?
A: There is no direct subsidy, but interest rates are subsidized and credit guarantees are available.
Q3: How long does approval usually take?
A: On average, loan approval can take 7 to 15 working days, depending on your documents and bank procedures.
Q4: Can I apply without a business registration?
A: For Shishu loans, it’s sometimes allowed, but for higher categories, a registered business entity is preferred.
The PM Mudra Loan Scheme is a game-changer for small entrepreneurs and aspiring business owners across India. With the new option to apply online, the entire process is now faster, more transparent, and accessible to everyone. Whether you’re planning to start a small food stall, expand your tailoring business, or launch a digital service, the Mudra loan can provide the financial support you need.
