Mudra loan limit increased to Rs 20 lakh as per the Budget announcement.

Mudra loan limit increased to Rs 20 lakh as per the Budget announcement.
Image Source By : ANI

New Delhi [India], October 25: In accordance with the announcement made in the Union Budget for 2024-25 in July, the limit for Mudra loans under the Pradhan Mantri Mudra Yojana (PMMY) has been increased from Rs 10 lakh to Rs 20 lakh.

The government issued an official notification regarding this change late on Thursday.

This enhancement aims to advance the overall goal of the Mudra Scheme, which is to provide funding to those who lack access to it.

This increase will particularly benefit emerging entrepreneurs by supporting their growth and expansion.

"The decision aligns with the government's commitment to fostering a robust entrepreneurial ecosystem," stated the government.

According to the notification, a new category called Tarun Plus will now be available for loans ranging from Rs 10 lakh to Rs 20 lakh. This category is intended for entrepreneurs who have previously taken loans under the Tarun category and have successfully repaid them.

The Credit Guarantee Fund for Micro Units (CGFMU) will provide guarantee coverage for PMMY loans up to Rs 20 lakh.

The Pradhan Mantri MUDRA Yojana (PMMY) is a scheme initiated by the Prime Minister on April 8, 2015, aimed at offering loans to non-corporate, non-farm small and micro enterprises. These loans are categorized as MUDRA loans under PMMY.

Loans under PMMY are disbursed by Member Lending Institutions (MLIs), which include banks, Non-Banking Financial Companies (NBFCs), Micro-Finance Institutions (MFIs), and other financial intermediaries.

The implementation of the financial inclusion program in India is built on three pillars: Banking the Unbanked, Securing the Unsecured, and Funding the Unfunded.

Loans under PMMY cater to both term loans and working capital needs for income-generating activities in manufacturing, trading, and service sectors, as well as activities related to agriculture, such as poultry, dairy, and beekeeping.

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