Pradhan Mantri Mudra Yojana (PMMY) achieved a historic milestone by disbursing loans worth ₹3.39 lakh crore in Q3 FY2024-25, the highest quarterly disbursement since the launch of the scheme in 2015. This significant growth reflects the Government’s continued commitment to empower micro and small enterprises in India.
Current Status of Mudra Loans
- Highest ever disbursement: Mudra loan disbursement reached an all-time high of ₹3.39 lakh crore in Q3 FY2024-25 (till December 2024).
- Largest Contributor: State Bank of India (SBI) holds the largest share in disbursement of Pradhan Mantri Mudra Yojana (PMMY) loans.
- Reduction in NPA: The overall NPA of PMMY loans has reduced from 4.9% in 2019-20 to 3.4% in 2023-24, improving the quality of loans.
Pradhan Mantri Mudra Yojana
- Launched in 2015, it is a flagship initiative of the Government of India aimed at providing affordable credit to micro and small enterprises.
- It aims to bring underdeveloped enterprises into the formal financial system and make credit accessible to them.
Objective
- “Fund the Unfunded” i.e. provide financial support to small businesses.
- Loans are provided through Public Sector Banks (PSBs), Regional Rural Banks (RRBs), Cooperative Banks, Private Banks, Foreign Banks, Microfinance Institutions (MFIs), and Non-Banking Financial Companies (NBFCs).
Loan Details
- Loan Amount: Loans up to ₹10 lakh are available for sectors that are not agriculture-based, such as construction, trading, services.
- Eligibility: Any Indian citizen who has a business plan and needs a loan up to ₹10 lakh can apply through a bank, MFI, or NBFC.
Loan Categories
- Shishu: Up to ₹50,000 (for new and micro enterprises).
- Kishor: ₹50,000 to ₹5 lakh (for growing businesses).
- Tarun: ₹5 lakh to ₹10 lakh (for expanding businesses).
Subsidy
- There is no direct subsidy under PMMY.
- If a loan is linked to a government scheme that provides capital subsidy, it can be availed under PMMY.
Impact of Mudra 1.0
- Loan disbursement: Over ₹27.75 lakh crore disbursed to 47 crore small entrepreneurs, increasing access to formal finance.
- Inclusiveness: 69% of loan accounts are held by women and 51% by SC/ST/OBC entrepreneurs.
- Employment generation: Self-employment boosted and small businesses grew in rural and semi-urban areas.
Vision of Mudra 2.0
Expanded scope
- Increase access in rural and semi-urban areas.
- Provide financial literacy, counselling, and business support.
- Financial literacy programmes: Implement programmes covering budgeting, savings, debt management, investment strategies, and digital literacy.
- Comprehensive Credit Guarantee Scheme (ECGS): To help banks mitigate risk to lend more to small enterprises.
Robust Monitoring and Evaluation Framework (RMEF)
- Monitoring of loan disbursement, utilisation and repayment in real time using technology.
- Increasing transparency and preventing abuse.