Overview
PM Mudra Yojana Loan is classified into the following three categories:
Categories
|
Maximum Loan Amount
|
Description
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Shishu
|
Rs. 50 thousand (US$ 677.07)
|
- This category is for entrepreneurs who are either in the early stages of their business or need minimal capital to get started. Under this category, the applicant will be qualified for a credit of up to Rs. 50,000 (US$ 677.07).
|
Kishor
|
Rs. 5 lakh (US$ 6.77 thousand)
|
- This category is for entrepreneurs who have a funding requirement between Rs. 50,000 (US$ 677.07) and Rs. 5 lakh (US$ 6.77 thousand). It includes entrepreneurs who have already started their company and need additional funds to expand.
|
Tarun
|
Rs. 10 lakh (US$ 13.54 thousand)
|
- This category includes entrepreneurs who have a funding requirement of Rs. 10 lakh (US$ 13.54 thousand), which is the maximum sum that an entrepreneur could apply for a start-up loan.
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In the last five years (from 2015 to 2020), the PMMY programme has benefited 24.48 crore loan accounts, with a sanction of Rs. 12.30 lakh crore (US$ 166.56 billion), allowing small business owners to contribute to the country's overall economic development.
According to a study published by the Labour Bureau, under the Ministry of Labour and Employment, MUDRA loans generated 11.2 million additional jobs between 2015 and 2018, wherein 55% were self-employed jobs and 45% comprised new jobs, which were created in existing businesses. In the same period, women workforce accounted for 62% of the total estimated increase in jobs in India.
According to the report, prior to the MUDRA scheme, 39.3 million people were working in numerous small businesses; this number increased to 50.4 million between 2015 and 2018. In addition, the number of self-employed people increased to 31 million until 2018, from 25.9 million (before the scheme). Also, the number of hired employees rose from 13.4 million to 19.5 million until 2018.
PMMY: Target vs. Achievement

In FY20, the total sanctions under PMMY increased to Rs. 3.37 lakh crore (~US$ 46 billion), exceeding the target set at Rs. 3.25 lakh crore (~US$ 44 billion) and benefiting 6.22 crore beneficiaries.
In FY21, PMMY sanctions stood at Rs. 2.7 lakh crore (US$ 37 billion) to ~42 million loans.
As of FY21 (until February 2021), PMMY disbursed 94% loans that were approved for micro and small enterprises (MSEs). Of the Rs. 2.38 lakh crore (~US$ 32 billion) loans to 3.68 crore accounts, Rs. 2.24 crore (US$ 303.44 thousand) was disbursed within 11 months in FY21.
PMMY Sanctions in FY20 by sub-categories of borrowers

In FY20, Shishu loans had the largest share among all three categories, accounting for 88% of the total accounts and 48% of the total value. Further, Shishu loans sanctioned funds increased by 15% YoY.

In FY20, 66% MUDRA loan accounts (in the Shishu category) belonged to women, who received 67% of the sanctioned amount. This high percentage was mainly due to MFIs lending microloans to women.
Women entrepreneurs are expected to play a significant role in transforming India into a self-reliant country. According to a report by Bain & Co. and Google, women entrepreneurs in India are expected to generate ~150-170 million jobs by 2030, accounting for > 25% of all new jobs available for India's working-age population.
Through PMMY, the government has offered numerous opportunities to women entrepreneurs. Between 2015 and 2021 (until February 2021), ~68% loans, representing 19.04 crore accounts, with a total value of Rs. 6.36 lakh crore (~US$ 86 billion) have been sanctioned to women entrepreneurs.
PMMY: Agency-wise Achievement in FY20
For FY20, the Indian government set a goal to achieve Rs. 3.25 lakh crore (~US$ 44 billion), under PMMY, which was distributed among various lending institutions, banks, MFIs (microfinance institutions) and NBFCs (non-banking finance companies) based on their scope and presence across the country.

In FY20, the overall output of the programme adopted by all lending institutions increased by 5% YoY at Rs. 3.37 lakh crore (~US$ 46 billion) from Rs. 3.21 lakh crore (~US$ 43 billion) (sanction amount) in FY19. In addition, public sector banks reported a 0.4% YoY surge and private sector banks posted a 43% YoY increase in terms of sanction amounts.
Among the public sector banks segment, State Bank of India (SBI) led the space, with Rs. 35,125 crore (~US$ 4 billion) sanctions, followed by Bank of Baroda at Rs. 10,282 crore (US$ 1.39 billion) and Canara Bank at Rs. 9,489 crore (US$ 1.29 billion).