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Documents required to apply for Mudra Loan: Check details here

In India, we have thousands of micro, small, and medium enterprises (MSMEs), all contributing to the growth of our economy. But despite that, they have always had trouble securing funding to maintain their business operations. 

To alleviate their hardships, the Indian government has come up with the Pradhan Mantri Mudra Yojana (PMMY). Under this scheme, MSMEs and even sole proprietors can gain access to funding through the Micro Units Development and Refinance Agency (MUDRA). 

If you’re a micro, small, or medium enterprise owner looking for funds, here’s a quick overview of the documents that you need to submit to apply for a Mudra loan. But before that, let’s quickly run through the Mudra loan scheme to get more clarity. 

What is the Mudra loan scheme? 

As you’ve already seen, Mudra loan is a special loan scheme offered by the Micro Units Development and Refinance Agency to both new and existing enterprises. There are three different types of loans that you can avail of depending on where your business currently is. Here’s a quick look. 

Shishu loan: This loan is for new and budding enterprises and proprietors. It allows you to borrow up to ₹50,000 for a tenor of up to 5 years. 

Tarun loan: Enterprises that are well-established and require funding to expand their operations can opt for this. Under this loan, you can borrow anywhere from ₹5 lakhs to ₹10 lakhs.

Kishore loan: Enterprises that have been set up but not well-established enough can opt for the Kishore loan. You can borrow anywhere from ₹50,000 to ₹5 lakhs under this loan to sustain your operations.    

The Mudra loan interest rate on these types of loans are dependent on the creditworthiness of the borrower and can range anywhere from 1% to 12% per annum. 

What are the documents required to apply for a Mudra loan?

Now that you’ve seen what the Mudra loan scheme is, let’s get down to the documentation part. Here’s a quick overview of what you would have to submit to get a loan. 

  • Shishu loan

Let’s take a look at the kind of documents that you would have to submit to apply for a Mudra loan. 

  • A duly filled Mudra loan application form 
  • Proof of identity 
  • Proof of address
  • 2 passport-sized recent photographs 
  • Details of the items that need to be purchased, including quotations
  • Details of the supplier 
  • Proof of establishment, including identity proof and address proof, if any 
  • Proof of category – OBC/SC/ST/minority 
  • Tarun and Kishore loans

The list of documents to be submitted are common for both Tarun and Kishore loans. Here’s a quick look. 

  • A duly filled Mudra loan application form 
  • Proof of identity 
  • Proof of address
  • Proof of establishment, including identity proof and address proof, if any 
  • 2 passport-sized recent photographs 
  • Details of the items that need to be purchased, including quotations
  • Details of the supplier 
  • A copy of your bank statement (for the previous 6 months)
  • A copy of the balance sheets for the previous 2 years 
  • A copy of the projected balance sheets 
  • Details of the sales made during the current financial year 
  • Details of the proposed project, if any 
  • Borrower’s assets and liability statement for determining the net-worth
  • Proof of category – OBC/SC/ST/minority 

Conclusion

Getting yourself a Mudra loan is really easy and can be done either through a bank, a non-banking financial institution, or even micro-lending institutions as well. Wish to know more details about the Mudra loan? Head on over to Finserv MARKETS now. You can even get to know about the various Mudra loan interest rates as well.  

  

Emma Murray

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