As announced in the July 2024-25 Union Budget, the Mudra loan limit under the Pradhan Mantri Mudra Yojana (PMMY) has been increased from Rs 10 lakh to Rs 20 lakh.

On Thursday, the government issued an official notification regarding the increase in Mudra loan limits, aimed at advancing the scheme’s objective of “Funding the Unfunded.”

This enhancement particularly benefits aspiring entrepreneurs, aiding their growth and expansion. The government stated that the move aligns with its commitment to fostering a strong entrepreneurial ecosystem.

The notification introduces a new Tarun Plus category for loans between Rs 10 lakh and Rs 20 lakh, available to entrepreneurs who have successfully repaid previous loans under the Tarun category.

The Credit Guarantee Fund for Micro Units (CGFMU) will provide guarantee coverage for loans up to Rs 20 lakh under the Pradhan Mantri Mudra Yojana (PMMY).

The Prime Minister launched the Pradhan Mantri MUDRA Yojana (PMMY) on 8th April, 2015, to provide loans to non-corporate, non-farm small and micro enterprises, known as MUDRA loans.

MUDRA loans under PMMY are offered by Member Lending Institutions (MLIs), which include banks, Non-Banking Financial Companies (NBFCs), Micro-Finance Institutions (MFIs), and other financial intermediaries.

The country’s financial inclusion program is built on three pillars: Banking the Unbanked, Securing the Unsecured, and Funding the Unfunded.

Loans under the Pradhan Mantri MUDRA Yojana (PMMY) are designed to support both term loans and working capital for income-generating activities in manufacturing, trading, and service sectors, as well as agriculture-related activities like poultry, dairy, and beekeeping.

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