The Ultimate Step-by-Step Guide to E-Mudra Loan Eligibility

Micro Units Development & Refinance Agency Ltd. (MUDRA) is an ambitious scheme launched by the Central Government of India to assist small businesses in propelling their growth. Owners of micro to small businesses from manufacturing, trading and other sectors can secure financial assistance for up to Rs. 10 Lakhs through the e-MUDRA loan. Before applying for the credit, you must know its eligibility parameters in detail.

Eligibility Criteria for e-MUDRA Loan

Here are certain eligibility parameters that you need to meet to qualify for the e-MUDRA loan:

  • Recipients of the loan must be 18 to 65 years old.
  • Both new and existing business owners can get the loan.
  • Applicants must have a small business in manufacturing, trading, agricultural-allied, or other sectors
  • Their venture must be profit-making, or they should have a sound plan to earn revenue.

You also need to know the business sectors for which the Government of India has targeted financial assistance through this scheme.

Businesses in Which You Can Leverage the e-MUDRA Loan

You can easily get the MUDRA loan if you are an owner of the below-mentioned businesses:

Food-Manufacturing SectorYou can apply for the e-MUDRA loan if you have a small business that produces food items like pickles, papad, bread, sweets, biscuits, ice cream, etc. Apart from these, if you have a small catering, food-storing or canteen service, you can apply for this credit facility to enhance your profitability.
Transport-Vehicle OwnersIf you own commercial transport vehicles like taxis, e-rickshaws or three-wheelers, or agricultural vehicles like tractors, power tillers, etc., you can take the MUDRA loan to grow your business.
Shops for Providing Certain ServicesYou can finance your existing salons, dry cleaning, tailoring shops, two-wheeler repair shops, gyms, pharmacies, boutiques, courier agents, etc., by taking this loan.
Textile BusinessTextile businesses like handloom, powerloom, traditional handwork, stitching, embroidery, dyeing, apparel design, knitting, cotton ginning, etc., fall under this category.
Agriculture-Oriented Business  You can get financial assistance to grow your farms of poultry, fishery, bee-keeping, livestock-rearing, dairy, pisciculture, etc. 

Features and Benefits of e-MUDRA Loan

Here are all the notable features and advantages of the e-MUDRA loan:

  • You do not need to mortgage your properties to request for MUDRA loan.
  • The credit also comes with zero restriction of end-usage.
  • The MUDRA loan interest rate is comparatively lower than regular business loans. Furthermore, you can get a discount on the interest rate if you belong to a scheduled caste or scheduled tribe and have a relevant caste certificate. 
  • You can select a tenure of your loan between 3 and 5 years.

Financial Institutions That Extend e-MUDRA Loan

Here are the various financial institutions from which you can get a business loan under this MUDRA Yojana:

  • Private sector banks
  • Public sector banks
  • Non-Banking Financial Institutions (NBFCs)
  • Micro Finance Institutions (MFI)
  • Regional Rural Banks (RRB)
  • Small Finance Banks (SFB)

Step-by-Step Guide to Apply for e-MUDRA Loan

You can apply for the credit online via the Udyami Mitra Portal or the website of your chosen lending institution that offers a PMMY-integrated business loan.

Here are the steps you need to follow to complete your application process for the e-MUDRA Loan through Udyami Mitra Portal:

Step 1: Visit the portal

Step 2: Tap on ‘Apply Now’

Step 3: Click on ‘Category of Browser’ and state whether you are an existing or new entrepreneur

Step 4: Enter your name, email ID, contact number

Step 5: Click on ‘Generate OTP’ and enter the number correctly for successful verification

Step 6: Fill in the application form with personal and professional details

Step 7: Go to the ‘Loan Application Centre Option’ and click on ‘Apply Now”

Step 8: Select the type of E-MUDRA loan (Shishu, Kishor or Tarun), that will suit your requirements

Step 9: Enter your business details

Step 10: Attach necessary documents in PDF, JPG, BMP or PNG format

Step 11: Mark tick on the given checkboxes

Step 12: Click on ‘Submit’

After this, you will get your loan application ID.

Alternatively, you can also apply for the MUDRA loan online from lenders’ websites. For this, you need to follow the steps mentioned below: 

Step 1: Visit the official website of your preferred lending institution

Step 2: Find the application form for the MUDRA loan

Step 3: Download the application form for any of the three types of MUDRA loan (Shishu, Kishor or Tarun) as per your fund requirement

Step 4: Fill in the form with the required personal, business or residential details

Step 5: Attach the necessary documents 

Step 6: Verify the filled-in application form and then submit it to your lending institution

After this, lenders will verify your application and contact you for the next procedures.

Documents Required to Apply for e-MUDRA Loan

You need to submit the following documents while applying for the loan:

  • KYC documents, such as Voter ID card, Aadhaar card, PAN card, etc.
  • Caste certificate (if any)
  • Business proof like GST returns, income statement, etc.
  • Income tax returns (ITRs)

If you are a small business owner and eligible for the e-MUDRA loan, you can request credit assistance to invest adequately in your venture. It will help you establish a strong presence in the market and create growth opportunities.