A Decade of Growth with PM Mudra Yojana

Marking its 10th anniversary on April 8, 2025, the Pradhan Mantri Mudra Yojana (PMMY), launched under the Micro Units Development and Refinance Agency (MUDRA), the Flagship Programme of the Prime Minister aimed at Funding the Unfunded micro-enterprises and small businesses. By removing the burden of collateral and simplifying access, MUDRA laid the foundation for a new era of grassroots entrepreneurship. By eliminating collateral requirements and streamlining access to institutional credit of up to Rs. 20 lakhs (US$ 23,288), the scheme has democratised finance for first-time entrepreneurs, especially in rural and semi-urban regions. Over 52 crore loans amounting to Rs. 32,61,000 crore (US$ 379 billion) have been sanctioned since inception, with Tamil Nadu, Uttar Pradesh, and Karnataka leading in total disbursals. Loan sizes have grown significantly—from an average of Rs. 38,000 (US$ 442.48) in FY16 to Rs. 1.02 lakh (US$ 1,187.86) in FY25—highlighting scalability and growing business confidence. 

Women comprise 68% of PMMY beneficiaries, with per woman disbursements growing at a CAGR of 13% between FY16 and FY25. Financial inclusion among socially marginalised groups is also evident—50% of Mudra accounts are held by SC, ST, and OBC entrepreneurs, while 11% belong to minorities. The share of Kishor loans, Rs. 50,000 (US$ 582.28) to Rs. 5 lakh (US$ 5,822.82), rose from 5.9% in FY16 to 44.7% in FY25, indicating a shift from micro to small-scale businesses. State Bank of India data reveals that Micro, Small, and Medium Enterprises (MSME) lending rose from Rs. 8,51,000 crore (US$ 99 billion) in FY14 to Rs. 27,25,000 crore (US$ 317 billion) in FY24 and is expected to cross Rs. 30,00,000 crore (US$ 349 billion) in FY25, reflecting PMMY’s role in fostering a robust, self-reliant economy. Recognised by the International Monetary Fund (IMF), the scheme continues to serve as a cornerstone for inclusive growth and grassroots job creation in India. 

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.