For which purposes can Mudra Loan be used?
Posted by Amir Azam on January 11th, 2021
The MSME segment extends almost every sort of convenience to the nation and contributes to a larger part of the nation’s economy. Therefore, the govt. of India and moneylenders have certain fund assistance alternatives for them so that they can power up their business and consequently uplift the economy of the country.
Out of many popular types of business loans in India, one is Mudra loan. The loan scheme was launched in the year 2015. The business loan scheme is officially known as Pradhan Mantri Mudra Yojana (PMMY) scheme.
The purpose of this scheme is to facilitate the Micro, Small and Medium Enterprises (MSMEs) financially in their financial crisis on low interest rates.
Mudra loan scheme has attained great demand since its inception and has extended financial facilitation steadily to borrowers. In the last five years, over Rs. 12 lakh crores have been disbursed into over 24 crore loan accounts under the scheme.
If you are a micro entrepreneur and seeking fund assistance to power up your business, Mudra loan may come in handy for you. Although, you need to figure out that for what purposes or categories you can avail the mudra loan. Let’s plunge into the post ahead to see a clear image of the purposes for which a Mudra loan can be availed.
As the term implies, the activities that are associated with the agriculture sector can avail this loan. Although, this category doesn’t include crop loans or loans which are focused to help agriculture.
In other words, loans which are availed for the progress of canals, irrigation and wells are not included in agri-associated activities for mudra loan. Following are the specified business activities that come under activities associated with agriculture in mudra loan:
If you are running a shop, a trading business or a service business then you may opt for Mudra loan for up to Rs. 10 lakhs.
This segment was particularly for women entrepreneurs and it is largely opted by female entrepreneurs only but that doesn’t state that men don’t run these activities. Following are the activities that are considered under this segment:
According to MSME ministry, a business whose investment in production plants and machinery is not exceeding Rs. 25 lakhs is considered as an MSME.
If your business is an MSME then you are entitled to apply for financial assistance to buy plant and machinery for your business.
As the population of India is so extensive, likewise there is a huge potential for food products and food processing enterprises. The extent of the industry is extremely vast. If your food business falls under any of the following then you can avail the mudra loan:
By all means, there are small and large businesses, even global players who step in this segment but to avail the mudra loan, your business should be an MSME.
Following are the businesses that are considered under this category:
Another purpose that you can take the mudra loan for is the transport vehicle business. This segment comprises:
If you have any other transport vehicle which is being used for commercial purpose then also it will fall under MSMEs and you can avail mudra loan.
The final stroke
Mudra loan is a commendable drive by the government but there are various other common and famous sorts of businesses that fall under the MSME segment but it might not have included in the above mudra loan details.
For instance, digital marketing agencies are a popular alternative for young Indians seeking to commence new businesses.
There are certain lenders that also extend e mudra loan and the State Bank of India is the most popular out of them.
You can avail SBI e mudra loan seamlessly with the easy paperless application process through the e mudra loan page of SBI portal.
Although, you need to note that you can avail up to Rs. 50,000 instantly and if the amount exceeds then you will need to visit the bank branch in order to perform the other required formalities.
Eventually, before applying, make sure to check your eligibility for mudra loan.
About the AuthorAmir Azam
Joined: December 28th, 2020
Articles Posted: 6
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