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Pradhan Mantri's Mudra Yojana – Funding the Unfunded! Under the aegis of the yojana, MUDRA has created three products as per the stage of growth and funding needs of the beneficiary micro unit.

By Dr. Somdutta Singh

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Urging the youth in India to become job creators rather than job seekers, Prime Minister Narendra Modi has always advocated them to aggressively strive for success. Every man and woman has the liberty to choose to be self-sufficient and independent. Supporting small entrepreneurs of India is not only the biggest need of the hour, but will also pave the way to help the Indian economy nurture and prosper.

While we've always been under the impression that large scale industries create more employment, the reality is in fact conflicting. Only 1 crore 25 lakh people find employment in large industries while small enterprises employ 12 crore people across the nation. With majority of the Indian populace working in small and medium businesses, the Government of India has initiated the Pradhan Mantri Mudra Yojana under the Micro Units Development and Refinance Agency (MUDRA) bank.

What Does The Yojana Signify?

The yojana has been established to facilitate development and endow economic support to micro units. In simple terms, the yojana provides funding to the non-corporate, non-farm sector income generating activities of micro and small enterprises whose credit needs are below 10 Lakh. This is a common platform where financial institutions such as banks, RRBs, MFIs, NBFCs will meet applicants willing to set up their micro and small enterprises and offer them financial support.

All Non-Corporate Small Business Segment (NCSBS) comprising of proprietorship or partnership firms running as small manufacturing units, service sector units, shopkeepers, fruits/vegetable vendors, truck operators, food-service units, repair shops, machine operators, small industries, food processors and others in rural and urban areas, are eligible for assistance under Mudra and will thus get an enormous boost.

The Various Segments

Under the aegis of the yojana, MUDRA has created three products as per the stage of growth and funding needs of the beneficiary micro unit. These schemes cover loan amounts as below:

  • Shishu: covering loans up to INR50,000

  • Kishore: covering loans above INR50,000 and up to INR5,00,000

  • Tarun: covering loans above INR5,00,000 and up to INR10,00,000

Eligibility of Mudra Loans

  • Applicant must be an Indian citizen above 18 years old and has to have a business plan to demonstrate. The business plan must contain the structure, investment plans, nature of product, marketing and future results as well.
  • The nature of industry should be non-farm earning activity related and needs investment of not more than Rs. 10 Lac. Other regulations will be same as the RBI guidelines and Mudra Yojana rules.

While small non-corporate entrepreneurs are often manipulated at the hands of money lenders, MUDRA will instill a new confidence in them that the government is ready to support them in their efforts that's contributing heavily to the task of nation building. In addition, right brand building, good advertising and marketing and concrete financial support to entrepreneurs will only strengthen the foundation of the Indian economy.

Dr. Somdutta Singh

Founder and CEO Assiduus

Dr Somdutta Singh is the the Former Vice-Chairperson of the NASSCOM Product Council, only woman to have ever held this post. She is also part of the Core Committee of WEP (Women Entrepreneurship Platform) by NITI Aayog and a serial Indian entrepreneur, mentor and angel investor.  

Somdutta has mentored various initiatives that include Google Launchpad, Microsoft and Target Accelerator, IIDT, Govt of Andhra Pradesh and is now a Mentor of Change at Atal Innovation Mission (AIM).  She is also currently on the advisory board of Karnataka Biz-tech ITBT Ministry, Co-trustee and Director at Centre for Entrepreneurial Excellence (CEE) & Digital Leadership Institute, Founder of IRA - a crowd sourced fashion label; Co- Founder - Amplicell - a heath supplements company & Founder, CEO at Unspun Group, one of India's 1st technology-based marketing solutions companies. 

She is also on the advisory board for BloombergQuint and has been a keynote speaker at several prestigious symposiums. She is a political analyst and has regularly appeared on debates across TV channels.


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