SBI Mudra Loan : The State Bank of India (SBI) has always played a vital role in financing within the nation, particularly with regards to small and medium sized enterprises (SME). Amongst its numerous interventions is the SBI Mudra loan which is also one necessary instrument for offering financial assistance to entrepreneurs as well as small businesses under Pradhan Mantri Mudra Yojana (PMMY).
This scheme was inaugurated on 8th April 2015 by the esteemed Prime Minister of the country whose intention was to provide non-corporate non-agricultural micro and small scale enterprises (MSEs) with loans that did not require any form of security within the range of 0-10 lakhs rupees.
The funds from this loan may be intended on various issues like starting a brand new business organization, enlarging an already existing one or refurbishing operations. Thus here is everything you need know about SBI Mudra Loans including eligibility requirements, application procedures etc.
Understanding MUDRA: The Foundation of the Scheme
MUDRA is a financial entity that was launched by the Government of India. Its main objective is to promote micro enterprises across the country and provide refinance to them. This entity partners with several partners such as 27 public sector banks, 17 private sector banks, 27 regional rural banks, and 25 microfinance institutions to provide financial assistance to deserving borrowers. With these partnerships MUDRA provides funds to the smallest units in the economy to help them grow into larger bodies and thus participate in national wealth creation.
MUDRA (Micro Units Development and Refinance Agency Limited) is a banking facility established by the Government of India. Its main objective is to raise funds for and lend to micro units within the country. It partners with various organizations such as 27 public sector banks, 17 private sector banks; 27 regional rural banks; and 25 microfinance institutions to provide financial assistance to deserving borrowers.
Through this partnership, MUDRA ensures that there is provision of cash to the lowest levels of the economy so that they can grow and play their role in the overall development of the country.
MUDRA: An initiative of the Government of India to finance micro units across the country. The main goal of the agency is to provide finance and support for the growth of micro enterprises. This instrument works in collaboration with several partners including 27 public sector banks, 17 private sector banks, 27 regional rural banks and 25 microfinance institutions to provide small loans to needy customers.
Through all these partners, MUDRA strives to ensure that they reach even the smallest units of the economy which are able to expand and contribute to the economic progress in our country.
Overview of SBI Mudra Loan
In India, State Bank of India (SBI) is a leading public sector bank responsible for the disbursal of Mudra Loans. These Loans are divided into three parts according to the requirements for financing by businesses:
- Shishu: Loans up to Rs. 50,000, primarily for startups and new businesses.
- Kishore: Loans ranging from Rs. 50,001 to Rs. 5 lakh, aimed at businesses looking to scale up.
- Tarun: Loans ranging from Rs. 5 lakh to Rs. 10 lakh, for well-established businesses needing substantial capital for expansion or modernization
SBI Mudra loan can be taken as either a term loan or working capital. It helps in several ways like buying assets, upgrading machinery, expanding business, or working capital.
Eligibility Criteria for SBI Mudra Loan
There are a few conditions that need to be satisfied by applicants so that they can qualify for SBI Mudra Loan. This lending scheme is meant for individuals and small enterprises who indulge in non-corporate, non-farming activities such as manufacturing, trading and services. Both existing businesses and start-ups can apply making it a lot more convenient for different groups of businesspeople.
Eligibility criteria set for SBI Mudra Loan:
Type of Business: Non-corporate, non-farm small or micro enterprises in manufacturing, trading and service sectors.
Types of applicants: Sole proprietorships, partnerships, start ups, small businesses, established businesses, retailers traders and service providers e.g. repair shops and transport services operators.
Age criteria: Candidate must be between eighteen (18) to sixty (60) years old.
Business registration: The business should be legally registered.
Credit score: Good credit score is advantageous but those with poor credit history may still apply.
Primary security: Such loans are collateral-free though stocks or machinery hypothecation may be required.
Special Provisions: Women entrepreneurs and minority groups may receive lower interest rates and flexible terms.
Account Requirements: Existing SBI customers can apply online for loans for amounts up to ₹50,000 while new ones have to open an account and in some cases go to the branch for applying higher amounts.
Proof of Income: For higher loan amounts income tax returns may be necessary.
How to Apply for SBI Mudra Loan
SBI Mudra Loan Application is not a complicated procedure. The process is simple and clear enough for both first-timers and those who have had previous transactions with SBI in order to ensure that you get the chance you are looking for without any stress or difficulty in accessing it. Below are some steps on how to apply for an SBI Mudra Loan
Applying for an SBI Mudra Loan is a straightforward process. Here’s a quick guide:
- 1.Determine Your Loan Category: Choose between Shishu (up to ₹50,000), Kishore (₹50,001 to ₹5 lakh), or Tarun (₹5 lakh to ₹10 lakh) based on your business needs.
- 2. Online Application (For Loans up to ₹50,000):
- Existing SBI customers can apply online through the SBI e-Mudra portal.
- Log in using your SBI account details.
- Fill out the application form, upload necessary documents, and submit.
- 3.Branch Application (For Loans Above ₹50,000):
-
- Visit the nearest SBI branch.
- Fill out the Mudra Loan application form.
- Submit the required documents (ID proof, residence proof, bank statements, business proof, etc.).
- The bank will process your application and disburse the loan upon approval.
- 4. Mudra Card: If approved, you may receive a Mudra Card for easy access to funds.
Documents Required
| Document Type | Details |
|---|---|
| ID Proof | Aadhaar, PAN, Passport, Voter ID |
| Residence Proof | Utility bills, Aadhaar, Passport |
| Bank Statements | Last 6 months |
| Business Proof | Registration, licenses |
| Photographs | 2 passport-size photos |
| Caste Certificate | If applicable (SC/ST/OBC) |
| Income Tax Documents | Last 2 years IT returns |
SBI e-Mudra Loan Apply Online: Overview
| Post Name | SBI e-Mudra Loan Apply Online: Get a ₹50,000 Loan in 5 Minutes, Here’s How to Apply |
|---|---|
| Post Type | Finance/Loans |
| Scheme Name | SBI e-Mudra Loan |
| Bank Name | State Bank of India |
| Loan Amount | Get ₹50,000 to ₹1 Lakh Loan Online |
| Apply Mode | Online |
| Official Website | https://sbi.co.in/ |
| Short Info | SBI e-Mudra Loan offers a quick and convenient way to secure financial support for entrepreneurs. Eligible SBI account holders can apply online for loans ranging from ₹50,000 to ₹1 lakh. |
SBI e-Mudra Loan Interest Rate:
As per SBI e-Mudra Loan scheme, one avails of loan amount up to ₹50,000 which needs to be repaid back to SBI bank within a span of five years at 9.5%. This would start taking place after three months of receiving the loan.
Repaying about ₹64,296 against it in five years time means repaying about₹1,128 every month for 57 easy installments at an interest rate of 9.5%.
FAQ
1. What is the SBI Mudra Loan?
The SBI Mudra Loan is a financial product offered under the Pradhan Mantri Mudra Yojana (PMMY) to provide credit to non-corporate, non-farm small/micro enterprises. It offers loans up to ₹10 lakh without requiring collateral, aiming to support the establishment or expansion of small businesses.
2. Who is eligible for an SBI Mudra Loan?
Entrepreneurs in the Non-Corporate Small Business Segment (NCSBS), including small manufacturing units, service sector units, shopkeepers, fruits and vegetable vendors, truck operators, and others, both in rural and urban areas, are eligible.
3. What are the different categories of the Mudra Loan?
The loan is categorized into three segments:
- Shishu: Loans up to ₹50,000.
- Kishore: Loans from ₹50,001 to ₹5 lakh.
- Tarun: Loans from ₹5,00,001 to ₹10 lakh.
4. What is the interest rate for an SBI Mudra Loan?
Interest rates are linked to the Marginal Cost of Funds based Lending Rate (MCLR) and vary based on the borrower’s credit profile and the category of the loan (Shishu, Kishore, or Tarun).
5. Is any collateral required for an SBI Mudra Loan?
No, the SBI Mudra Loan is collateral-free. However, borrowers must hypothecate (pledge) the stocks, machinery, and other assets purchased with the loan to the bank as primary security.
6. How can I apply for an SBI Mudra Loan?
Existing SBI customers can apply online for loans up to ₹50,000 through the SBI e-Mudra portal. For larger amounts, you must visit the nearest SBI branch.
7. What documents are required for an SBI Mudra Loan?
You will need identification proof (like Aadhaar, PAN), address proof, business proof, bank statements, income tax returns, and quotations for any equipment or machinery to be purchased.
8. Can women entrepreneurs apply for an SBI Mudra Loan?
Yes, women entrepreneurs can apply under the Mahila Uddyami Scheme, which is a part of the Mudra Yojana. They can avail of loans under the Shishu, Kishore, or Tarun categories.
9. Is the Mudra Loan available only for rural areas?
No, the Mudra Loan is available to entrepreneurs in both rural and urban areas.
10. What is a Mudra Loan Card?
The Mudra Loan Card is a credit card with a limit based on the working capital portion of the Mudra Loan. It can be used for making business-related purchases and withdrawals at ATMs.