Banking Awareness notes on MUDRA Bank

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General Awareness play a vital role in all  Examination. we can expect  Questions from different Topics.In Banking and other competitive exams like RRB, CDS, LIC AO, RBI, SSC, UPSC, FCI, UIIC, OICL, SBI Clerks and PO the questions on MUDRA Bank are being asked. Here we have given Banking awareness study notes on : MUDRA Bank for SSC CGL Examinations 2019-20 & other examination. Candidates those who are all preparing for the Examination can use this study material.

Pradhan Mantri Mudra Yojana

Micro Units Development & Refinance Agency Ltd. (MUDRA) is a new institution set up by Government of India to provide funding to the non-corporate, non-farm sector income generating activities of micro and small enterprises whose credit needs are below ₹10 Lakh.

The inception of MUDRA Yojana was done keeping in mind several objectives to be fulfilled during the implementation of this yojana. The most prominent of these are:

1. For laying down policy guidelines for financing small/ micro enterprises
2. Getting all the Microfinance Institutions and related entities registered and then regulating the same
3. For helping the small businesses develop and grow further
4. Assisting lower income groups in building and expanding their business
5. To assist in creating easy access to finance for unbanked and help in lowering their cost of finance
6. To provide SC/ST lending preference
7. For regulating all Microfinance Institutions that are dealing with trading, manufacturing, and service

Quantum of loan (Min/Max)

• Maximum loan amount : Upto Rs 10 lacs
• Loans upto Rs.50,000 are categorised as SHISHU
• Loans from Rs.50,001 to Rs.500,000 are categorised as KISHORE
• Loans from Rs.500,001/- to Rs.10,00,000/- are categorised as TARUN.

Funding Support under MUDRA Loan

MUDRA offers four types of funding support:

1. Micro Credit Scheme
   • Loans can be availed to the extent of Rs.1 lakh. The funds can be used for a variety of micro enterprise activities.
   • Targeted primarily at groups such as Joint Liability Groups (JLGs) and Self Help Groups (SHGs).
   • Any Micro Finance Institution (MFI) that wishes to avail a loan should enrol with MUDRA and comply with its requirements.
2. Women Enterprise Programme
   • Additional facilities are offered to women entrepreneurs to encourage them to follow their dreams.
   • Facilities include the reduction of interest on loans. Currently, MUDRA loans can be availed by Micro Finance Institutions (MFIs) or Non Banking Financial Companies (NBFCs) with a discount of 25 basis points or 0.25% on the interest rates, provided they offer loans to women.
3. Refinance Scheme for Regional Rural Banks/Commercial Banks/Scheduled Co-operative Banks
   • Various banks such as Scheduled Co-operative Banks, Regional Rural Banks, and Commercial Banks can avail refinance.
   • Refinance amount offered can go up to Rs.10 lakh per unit, and the funds can be availed as working capital loans or term loans. This is applicable to banks that have taken loans under the Tarun, Kishor, and Shishu categories.
4. Securitisation of loan portfolio
   • MUDRA extends support to NBFCs, MFIs, and banks to fund micro enterprises through participation in securitisation of their loan assets.

List of activities which cover MUDRA loans

• Community, Personal Service and Social ActivitiesThe activities/businesses for which MUDRA loans can be availed under this head include medical shops, boutiques, saloons, gymnasiums, dry cleaning, beauty parlours, motorcycle repair shops, tailoring shops, courier services, photocopying and DTP facilities, etc.

• Transport VehicleMUDRA offers financing for buying transport vehicles for goods as well as personal transport like auto rickshaws, three-wheelers, passenger cars, e-rickshaws, taxis, etc.
• Food Products SectorUnder the Food Products Sector, MUDRA loans can be availed for activities like achaar making, papad making, jelly or jam making, day-to-day catering, small service food stalls, cold storages, ice cream making units, cold chain vehicles, bun and bread making, etc.
• Business Loans for Shopkeepers and TradersMUDRA loans under this head can be availed by individuals who require financing for running their shops, service enterprises, business and trading activities, and non-farm activities that generate income.
• Textile Products SectorMURDA loans under this head are available for activities such as powerloom, handloom, chikan/zardozi work, khadi activity, traditional printing and dyeing, knitting, computerised embroidery, apparel design, other textile activities for non-garment products, etc.
• Agriculture and Allied ActivitiesMUDRA loans can also be availed for bee keeping, pisciculture, livestock, sorting, agriclinics, dishery, etc.

• Equipment Finance Scheme for Micro Units

  MUDRA loans are extended for the setting up of micro enterprises by buying the necessary equipment/machinery.