Pradhan Mantri Mudra Yojana
- 11 Feb 2022
- 3 min read
Why in News?
Recently, the Union Minister of State for Finance provided information about the Pradhan Mantri Mudra Yojana (PMMY) in the Rajya Sabha.
- The national-level targets under the scheme have been consistently met since its inception, except for FY 2020-21 due to the Covid-19 pandemic.
What is PMMY?
- The government launched it in 2015 for providing loans up to Rs.10 lakh to the non-corporate, non-farm small/micro-enterprises.
- It provides funding to the non-corporate small business sector through various last-mile financial institutions like Banks, Non-Banking Financial Companies (NBFCs) and Micro Finance Institutions (MFIs).
- MUDRA, which stands for Micro Units Development & Refinance Agency Ltd., is a government's financial institution. It does not lend directly to micro-entrepreneurs/individuals.
- MUDRA has created three products, i.e. 'Shishu', 'Kishore' and ‘Tarun’, as per the growth and funding needs of the beneficiary micro-units.
- Shishu: Covering loans up to Rs. 50,000.
- Kishore: Covering loans above Rs. 50,000 and up to Rs. 5 lakh.
- Tarun: Covering loans above Rs. 5 lakh and up to Rs. 10 lakh.
What are the achievements of the scheme?
- Over 32.53 crore loans involving a sanctioned amount of Rs. 17.32 lakh crore have been extended under PMMY since its inception in April 2015.
- Loans have been given to disadvantaged sections of society such as women entrepreneurs, SC/ST/OBC borrowers, Minority community borrowers, etc. The focus has also been on new entrepreneurs.
- As per a survey conducted by the Ministry of Labour and Employment, PMMY helped in generating 1.12 crore net additional employment from 2015 to 2018.
- Out of the 1.12 crore of estimated increase in employment, women accounted for 69 lakh (62%).
What are the steps taken for the improvement of the Scheme?
- Provision for online applications through psbloansin59minutes and udyamimitra portal.
- Some Public Sector Banks (PSBs) have put end-to-end digital lending for automated sanctions under PMMY.
- Intensive publicity campaigns by PSBs and Mudra Ltd. for increased visibility of the scheme amongst the stakeholders.
- Nomination of Mudra Nodal Officers in PSBs.
- Periodic monitoring of the performance of PSBs concerning PMMY etc