If you have been finding it difficult to obtain a business loan, don’t worry, now you can avail up to ₹10 lakh without having to pledge any asset or even pay a single penny as processing charges. It is all made possible through the Central Government’s Pradhan Mantri Mudra Yojana (PMMY), which has made funding available at an affordable cost to small businessmen as well as new ventures.
Let’s divide into bits how it works and how you can avail without beating about the bush.
No Collateral Needed, No Processing Fee – Just Pure Finance
This unique government lending program has been created for small businesses, new start-ups, and individual entrepreneurs. The best part is that you won’t have to hold anything back as collateral, and there’s no processing fee whatsoever.
The program helps those in need of money to establish or grow a business, purchase machines, recruit employees, or finance daily operations.
Who Can Take This Loan
Under Mudra Loan scheme, any person running a non-agricultural, non-corporate business can take the facility. Whether you are starting a roadside stall, tailoring shop, beauty parlour, tuition class, or any micro enterprise, this scheme is yours.
It is especially for:
First-time entrepreneurs
Small shop owners
Self-employed individuals
Street vendors
Women entrepreneurs
Local service enterprises
Three Slabs of Loans – Pick What You Need
PMMY loans are available in three slabs, depending on your finance need:
1. Shishu Loan – ₹50,000 (best for small start)
2. Kishor Loan – ₹50,000 to ₹5 lakh (for business expansion)
3. Tarun Loan – ₹5 lakh to ₹10 lakh (for business expansion and bigger needs)
So, whether you wish to start small or want to expand your current business, there’s a loan segment that is suitable.
EMI is Affordable – Pay Without Stress
Worried about repayment then you don’t have to. The interest rates are kept low, and EMIs are made affordable. As it is a collateral-free loan, you don’t have to mortgage property, gold, or land.
You can avail this loan from a variety of financial institutions such as:
Public sector and private sector banks
Regional rural banks
Small finance banks
NBFCs (non-banking financial companies)
Flexible Tenure – Get 1 to 5 Years
The loan repayment period is a general 1 to 5 years. And even in case you are having some financial problem, there is an option of extending the loan tenure. You are paying interest only when you utilize the loan amount through a Mudra Card.
That is, you will not be paying for unnecessary money which you do not require, which is really a relief for small businesses.
Documents You’ll Need to Apply
The application process is simple. You just need a few basic documents:
Aadhaar Card
PAN Card
Address and business proof
Recent passport-size photos
ITR (Income Tax Return), if you have any
Sales vouchers, if any
You can apply for the loan in the nearest branch. Once your documents are cross-checked by the bank, the amount is transferred to your loan account. The process will take only 30 days.
Big Help for Small Dreams
In a period when financing a business seems to be a big task, Pradhan Mantri Mudra Yojana is a real beacon of hope. You do not have to plead for funds with the banks or risk rejection. This ₹10 lakh business loan without collateral and no fee may prove to be your golden key to achieving your dream or growing your business.