PM MUDRA YOJANA (Syllabus: GS Paper 2 – Government Scheme)

Context: The Union Finance and Corporate Affairs Minister of India recently emphasized that women entrepreneurs are accorded first priority under the Centre's flagship Pradhan Mantri Mudra Yojana scheme, which offers financial assistance to beneficiaries.

Pradhan Mantras Mudra Yojana Scheme

• About: Initially, Pradhan Mantri Mudra Yojana (PMMY) offers unsecured loans of up to 10 lakh to small/micro enterprises that are non-corporate and non-farm in nature.
• Launched: In 2015
• Objective: To encourage young people to become 1st generation entrepreneurs.
• Eligible Banks for Loan: Banks, NBFCs, Micro finance Institutions (MFIs) and financial intermediaries as notified by MUDRA Ltd.
• Loan Instruments:
• Shishu: covers loans up to Rs 50,000/-
• Kishor: covers loans above Rs 50,000/- and upto Rs. 5 lakh
• Tarun: covers loans above Rs 5 lakh and up to Rs 10 lakh

Achievements of PMMY

• The Mudra Scheme has generated eight crore new entrepreneurs. 
• The scheme has effectively connected India's microfinance and banking sectors by extending loans to micro-entrepreneurs. 
• Addressing the sub-culture of poverty, the PMMY has rapidly diminished its presence in a short span of time.