Boosting MSMEs: Get ₹20 Lakh Via Mudra Loans Initiative
Updated: 24-12-2025 at 3:30 PM
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In the Union Budget 2024, Finance Minister Nirmala Sitharaman announced the credit limit under the Pradhan Mantri MUDRA Yojana (PMMY) to be increased to Rs. 20 lakhs for the Micro Units Development and Refinance Agency. MSMEs contribute a huge part to the country’s Gross Domestic Product (GDP), so helping them with their credit facilities will impact the country’s economy as well.
This also represents the government’s concern toward the struggles faced by the Micro, Small, and Medium Enterprises (MSMEs), especially after the sudden and unfortunate outbreak of the COVID-19 pandemic. The scheme also aims to encourage more and more people to enter the field of entrepreneurship and generate employment for themselves and others as well.
Read the article to learn more about the government scheme, ranging from its meaning and benefits to its eligibility criteria and application process, including answers to popular questions like, ‘Is there a PMMY gov in portal or PMMY app?’.
Overview
The table below summarises some key details about the Pradhan Mantri MUDRA Yojana (PMMY) that one should know.
| Name of the scheme | Pradhan Mantri MUDRA Yojana (PMMY) |
|---|---|
| Launched by | Government of India |
| Launched in | 2015 |
| Objective | To help Micro, Small, and Medium Enterprises get affordable credit to run their businesses |
| Mode of Pradhan Mantri Mudra Yojana registration | Offline |
| Is there a PMMY portal or PMMY app? | No |
Read More: New RBI guidelines on MSME loans
What Is The Pradhan Mantri Mudra Yojana?
The Pradhan Mantri Mudra loan (PMMY) was launched in 2015 by the Indian government. It was introduced to help Micro, Small, and Medium Enterprises (MSMEs) get affordable credit to run their businesses. The Mudra loan scheme aims to help MSMEs kick-start and grow their enterprises.
By providing larger loans through the Pradhan Mantri Mudra Yojana Personal Loan feature of the scheme, the government hopes to encourage entrepreneurship, job creation, and overall economic growth.
MSMEs can avail of Rs. 10 lakhs under the Mudra loan scheme from commercial banks, small finance banks, and non-banking financial corporations. However, during the Union Budget 2024, Finance Minister Nirmala Sitharaman announced that MSMEs will now be able to avail of Rs. 20 lakhs.
During the last financial year, the government approved Rs. 5.4 lakh crore for the Pradhan Mantri Mudra Yojana UPSC. Nirmala Sitaraman also announced that the government has set aside provisions for supporting 50 multi-product irradiation units in the MSME sector.
When the COVID-19 pandemic hit, MSMEs were affected deeply as there was no demand or supply for the commodities. The government decided to increase the Mudra loan limit from Rs. 10 lakhs to Rs. 20 lakhs under the Pradhan Mantri Mudra Yojana to help the growing financial needs of MSMEs and help them recover the losses they incurred during the pandemic.
What Are The Benefits Of Pradhan Mantri Mudra loan (PMMY) For MSMEs?
The decision to increase the Mudra loan limit has several benefits for MSMEs. Some of the popular benefits of this scheme are mentioned below:
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Access To More Funds
MSMEs who incurred losses and want to grow their business can now access larger amounts of credit, which can be used for expanding operations, purchasing new equipment, and hiring new staff.
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Lower Interest Rates
The Pradhan Mantri Mudra loan is known for its low interest rate compared to normal bank loans. This makes it easier and more affordable for MSMEs to avail loans.
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No Requirement of Collateral
Micro, Small, and Medium Enterprises that apply for a loan through this govt scheme can freely do so without having to deposit any collateral. This becomes an extremely attractive feature of the scheme for first-time entrepreneurs, micro business units, and people from the economically backward classes.
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Simpler Process
Pradhan Mantri Mudra loan has a more simplified process compared to other bank loans. It has minimal paperwork and quicker approvals, ensuring there is no delay so that MSMEs can access funds faster.
Also Read: Complete Guide To The MSME Sustainable (ZED) Certification Scheme
What Is The Eligibility Criteria To Apply For The Mudra Loan Scheme?
Individuals meeting the pre-determined eligibility criteria can apply for the Mudra loan scheme. The Pradhan Mantri Mudra Yojana eligibility criteria are as follows:
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Individuals between the ages of 18 and 65 years.
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Traders, artisans, shopkeepers, vendors, small manufacturers, retailers, and other business entitiesare engaged in the trading, services, and manufacturing sectors.
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Women entrepreneurs are also a part of the Pradhan Mantri Mudra Yojana eligibility criteria.
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People belonging to the SC/ST/OBC castes can also apply for the scheme.
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People with no past loan issues with any financial institution.
What Is The Application Process Of The Mudra Loan Scheme?
MSMEs that want to apply for the Mudra loan scheme can do so through an offline procedure, as there is no PMMY login registration or Pradhan Mantri Mudra Yojana online apply SBI process. The process of Pradhan Mantri Mudra Yojana registration is described below in a stepwise manner for one’s better understanding:
Step 1: Firstly, please ensure that you fulfil all the Mudra loan eligibility criteria before applying for the scheme.
Step 2: Collect all required documents, such as business proof, identity proof, address proof, and a business plan.
Step 3: As there is no Pradhan Mantri Mudra Yojana online apply, please visit a bank or a financial institution that offers the Mudra loan scheme.
Step 4: Request a Pradhan Mantri Mudra Yojana application form and fill out the application form accurately and carefully.
Step 5: Submit the Pradhan Mantri Mudra Yojana application form along with all the required documents.
Step 6: Complete the Pradhan Mantri Mudra Yojana registration process and wait for the approval of the loan.
What Are The Documents Required For The Mudra Loan Scheme?
Individuals are required to submit some documents while doing the Pradhan Mantri Mudra Yojana registration process. The list of those documents is as follows:
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Business proof
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Business plan
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Bank account details
Conclusion
Increasing the loan limit from Rs. 10 lakh to Rs. 20 lakh under the Pradhan Mantri Mudra loan (PMMY) will help the Micro, Small, and Medium Enterprises kick-start their businesses. By providing easier access to funds, the government is helping MSMEs overcome challenges and helping them recover the losses made during the pandemic.
The Mudra loan scheme is an excellent initiative taken by the government to support the entrepreneurs of India by creating a healthy and growing ecosystem for them. The scheme not only aims to support small business owners but also contributes to India’s long-term goals, such as strengthening the economy, inclusive development, and self-reliance.
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