PM Mudra Yojana : How to Get a ₹10 Lakh Loan Without Collateral

What is PM Mudra Yojana?

Launched by the Indian Government, the Pradhan Mantri Mudra Yojana (PMMY) is a flagship initiative designed to offer collateral-free loans up to ₹10 lakhs to non-corporate small businesses, MSMEs, and self-employed individuals.

If you’re wondering what is PM Mudra Yojana, it’s essentially a PM business loan scheme under which the government helps small entrepreneurs access credit easily.

Also known informally as the PM Modi loan yojana, this program was created to financially empower India’s grassroots businesses — from chaiwalas and tailors to startups and traders.

📊 Loan Amount, Categories & Interest Rate

PM Mudra Yojana loan is classified into three types based on business needs:

Wondering about the PM Mudra Yojana interest rate? It’s kept low to support small entrepreneurs — especially in rural and semi-urban India.

🔍 If you’re searching for a prime minister interest free loan scheme in India, note: PMMY doesn’t offer 0% loans, but provides low-interest loans without collateral.

💼 Who Can Apply for a Mudra Loan?

This scheme is designed for:

• Micro and Small Enterprises (MSEs)
• Service units (beauty parlours, repair shops, etc.)
• Shopkeepers and traders
• Manufacturers and artisans
• Agri-allied businesses (dairy, poultry)
• Food vendors, tailors, truck owners

You can apply if:

• You’re 18+ years old
• You have a non-corporate business
• You’re self-employed or running a small enterprise
• You’re looking for a PM business loan without a guarantor

📥 PM Mudra Yojana Online Apply – Step-by-Step Guide

If you’re wondering how to apply for PM Mudra Yojana or how to get loan from PM Mudra Yojana, here’s the easy process:

✅ Online Process:

1. Visit: https://www.udyamimitra.in
2. Choose “PM Mudra Loan”
3. Select loan type: Shishu, Kishore, or Tarun
4. Upload required documents
5. Submit the form for bank verification
6. Receive approval & disbursal

✍️ Search queries like pm mudra yojana online apply and how to apply pm mudra yojana are trending in 2025 — and this process answers them directly.

📑 Documents Required

• Aadhaar card & PAN card
• Business proof or registration
• Bank account statement (last 6 months)
• Quotation for machinery/assets
• Business plan (for Kishore/Tarun)

🏦 Where to Apply

Apart from online application, you can also apply through:

• Public sector banks (SBI, PNB, BOB, etc.)
• Private banks (ICICI, Axis, HDFC)
• Microfinance institutions (MFIs)
• NBFCs
• Common Service Centres (CSCs)

💼 Affiliate CTA:
👉 Apply for PM Mudra Yojana Loan – Check Eligibility

🎯 Why Choose PM Mudra Yojana in 2025?

• ✅ No collateral needed
• ✅ Subsidized interest for small borrowers
• ✅ Loans for all stages – startup to expansion
• ✅ Trusted by over 30 crore Indians
• ✅ Accepted by over 300+ lending institutions

If you’re looking for a Modi loan for self-employment, this is your best bet in 2025.

🧠 UPSC & PM Mudra Yojana – Current Affairs Angle

If you’re preparing for UPSC, note: PM Mudra Yojana UPSC relevance includes topics like:

• Financial inclusion
• Priority sector lending
• Employment generation in rural areas
• MSME growth & GDP contribution

Include this under Government Schemes in your preparation.

📢 Real Example: From Tailor to Employer

Rekha, a tailor from Udaipur, took a ₹1 lakh Kishore loan in 2021 under Pradhan Mantri Mudra Yojana. Today, she owns 4 sewing machines and employs two other women. She’s now eligible for a Tarun loan to expand her shop.

FAQs – PM Mudra Yojana 2025

1. What is PM Mudra Yojana and its benefits?

Answer:
PM Mudra Yojana is a government-backed scheme launched by PM Narendra Modi to provide collateral-free business loans to micro and small businesses in India. Benefits include:

• No need for security or guarantor
• Affordable interest rates
• Support for early-stage and growing businesses
• Loan up to ₹10 lakhs
• Accepted by major banks including SBI, HDFC, and NBFCs

Know More about Other Govt. Schemes

2. What is the maximum loan given under PM Mudra Yojana?

Answer:
The maximum loan offered under the PM Mudra Yojana is ₹10 Lakhs, available under the Tarun category. Borrowers can choose from three tiers:

• Shishu: Up to ₹50,000
• Kishore: ₹50,001 to ₹5 Lakhs
• Tarun: ₹5 Lakhs to ₹10 Lakhs

3. What is the Mudra loan scheme?

Answer:
The Mudra loan scheme (Micro Units Development and Refinance Agency) is a flagship initiative under the PMMY program aimed at providing business loans without collateral to small entrepreneurs, traders, artisans, and MSMEs. It helps promote financial inclusion and employment at the grassroots level.

4. What is the maximum age limit for a Mudra loan?

Answer:
There is no official maximum age limit for applying under PM Mudra Yojana, but most banks typically require applicants to be between 18 and 65 years at the time of loan maturity.

5. What if one cannot pay a loan taken from Mudra Yojana?

Answer:
If you default on a Mudra loan:

• Your credit score may be affected
• The lender may take legal recovery actions
• You may lose eligibility for future government schemes
  However, some banks may offer rescheduling or restructuring options, especially for Shishu and Kishore loan holders.

6. What interest rate is charged on MUDRA loan?

Answer:
Interest rates vary by lender. On average:

• Shishu loan: ~8% to 12%
• Kishore loan: ~8% to 11.5%
• Tarun loan: ~7.30% to 10%
  SBI Mudra loans typically offer competitive rates under regulated guidelines.

7. What is the reason for the initiation of Mudra loan in India?

Answer:
The Mudra Yojana was initiated to:

• Bridge the credit gap in India’s informal sector
• Support small entrepreneurs with easy and affordable loans
• Encourage self-employment and job creation
• Strengthen the rural and semi-urban economy

8. What can I do when my bank denies me a Mudra loan?

Answer:
If your bank rejects your application:

• Ensure your documents and business plan are complete
• Try a different Mudra-partnered bank, including SBI, PNB, or NBFCs
• File a grievance on pmmy.gov.in or contact the bank’s nodal officer
• Visit a Common Service Centre (CSC) for assistance

9. What is Mudra Shishu loan?

Answer:
Mudra Shishu loan is the entry-level category under PMMY, offering loans up to ₹50,000. It’s best suited for:

• First-time entrepreneurs
• Small shops and vendors
• Home-based businesses
  It requires minimal documentation and has the lowest interest rate among the three Mudra loan tiers.

10. What is SBI Mudra loan and how is it different?

Answer:
SBI Mudra loan is offered by the State Bank of India under the PM Mudra Yojana. It follows the same three-tier format (Shishu, Kishore, Tarun) but is known for:

• Wider branch access
• Faster processing
• Lower interest rates compared to many NBFCs
  To apply, visit the SBI branch or sbi.co.in and check the Mudra loan section.