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Home » SBI e-Mudra Loan: A Venture Launched to Support SME Business in India

SBI e-Mudra Loan: A Venture Launched to Support SME Business in India

SBI e-Mudra Loan

State Bank of India is one of the government banks operating in India for a very long time. They have been serving their customers with various loan products at a very minimal interest rate. One such loan is SBI e-Mudra Loan. This venture was initiated in collaboration with the Indian government, which aimed to support SME businesses in India with financial aid. This loan falls under the scheme PMMY (Pradhanmantri Mudra Yojna), initiated by the government of India.

This blog will help you understand more about the SBI e-Mudra Loan and how you can get one. So, follow us till the end of the blog to know every bit and bite of the SBI e-Mudra loan.

What is SBI e-Mudra Loan?

In order to offer financial help to consumers who qualify for it, the State Bank of India has played a significant role in a number of programs that have been carried out on behalf of the Indian government. Some of the programs available from the Micro, Small, and Medium-Sized Enterprise (MSME) Loan Division are intended for ambitious entrepreneurs who already have a successful business. The Pradhan Mantri Mudra Yojana (PMMY) is one of these programs, which the State Bank of India supports.

To your knowledge, MUDRA stands for Micro Units Development and Refinance Agency Ltd.

On April 8, 2015, the Pradhan Mantri MUDRA Yojana (PMMY) was introduced to provide loans up to Rs 10 lakh to non-corporate, non-farm MSME firms. The Pradhan Mantri Mudra Yojana is available to anyone who needs money for business operations, growth, firm setup or upgrading, etc.

Features of SBI e-Mudra Loan

The table below entails the features of the SBI e-Mudra loan:

Particulars

Specifications

Loan’s Characteristics

Available as a term loan or working capital

Goal

Capital for new ventures, modernisation of current units, unit growth, and the acquisition of equipment and gear

Eligibility

Entrepreneurs wishing to start a new firm or established, profitable organisations looking to expand their operations.

Repayment tenure

3 –5 years

Processing fee

Shishu and Kishore loans don’t charge any processing fee. Tarun loans have a processing fee of 0.5% of the loan amount.

Margin

Nil for loans up to Rs.50,000

10% for loan amounts ranging from Rs.50,001 to Rs.10 lakh

Rates of interest

Depends on the MCLR rates

Collateral required

No security is required. However, for Term loans, P&M must be hypothecated, and stocks and receivables must be hypothecated for Cash credit.

Categories of SBI e-Mudra Loan

Limit

Shishu

Kishore

Tarun

Daily Withdrawal Limit

Rs. 10,000

Rs. 15,000

Rs. 20,000

Daily POS Limit

Rs. 15,000

Rs. 25,000

Rs. 30,000

There are three categories of SBI e-MUDRA loans. Applicants can submit their application after choosing the category that best suits their needs.

  • Shishu

You can get loans up to Rs. 50,000 with an interest rate of at least 1% per month or 12% per year. The repayment tenure for the same is one to five years.

  • Kishore

Get a loan with a minimum amount of 50,001 and a maximum amount of 500,000 rupees. The lending bank would choose the interest rate in accordance with the program’s guidelines while taking the applicant’s creditworthiness into account. The bank is free to decide how long the recovery period will last, although it cannot exceed five years.

  • Tarun

The loan amount ranges from 5 to 10 lakhs rupees. The other guidelines are the same as the Kishore category.

Why should you apply for SBI e-Mudra Loan?

People who require financing for their business-related needs might consider the Pradhan Mantri e-Mudra Yojana. The following are just a few of the many advantages of the Pradhan Mantri Mudra Yojana:

  • The country’s micro firms benefit from increased funding of the e-Mudra initiative.

  • This program provides loans with low-interest rates to anyone who requires money for commercial activities.

  • The initiative aids in the growth of the GDP and the creation of new jobs.

  • Processing fees for the e-Mudra Yojana are comparatively low. There is no processing fee for the Kishore and Shishu loan programs and for the Tarun loan there is a nominal interest rate of 0.50% plus tax.

Eligibility for SBI e-Mudra Loan

Entrepreneurs wishing to launch a new company or successful businesses looking to grow their operations can both apply for e-Mudra Loans. Both rural and urban employees in the Non-Corporate Small Business Segment (NCSB) are eligible for the loan. This loan category consists of sole proprietorships or partnerships running the following types of businesses:

  • Small manufacturing units

  • Service sector units

  • Shop owners

  • Product vendors

  • Truck drivers

  • Foodservice operators

  • Repair shops

  • Machine operators

  • Small industries

  • Artisans

  • Food processors

Documents required for SBI e-Mudra Loan

You must keep the following documents handy before applying for the SBI e-Mudra loan:

Documents required for Shishu Mudra Loan

  • GST registration certificate

  • Udyog Aadhaar Details

  • SBI Account Shop and Establishment Certificate

Documents required for Kishore and Tarun Mudra Loan

  • Passport size photographs of the applicant.

  • Voter ID, PAN Card, Aadhar, and Passport, are needed as identification proof.

  • Proof of residency, such as a passport, utility bills, property tax receipts, etc.

  • Bank statements of the last six months.

  • Price quotation for purchasing equipment or machinery.

  • Aadhaar and proof of establishment are required as the business ID.

  • The last two years’ Balance Sheet and profit and loss statement, Partnership agreement, and legal documents.

How to apply online for the SBI e-Mudra Loan?

Follow the below step-by-step process to submit your online application for the SBI e-Mudra Loan:

  • Visit the SBI online portal and click the ‘Proceed for e-Mudra’ option.

  • Read the instructions given in Hindi or English and click on ‘’Ok’’ to proceed to the next page.

  • Fill in your mobile number, SBI savings/current account number, and required loan amount.

  • Click on ‘Proceed’.

  • Fill in the details required in the online application form. You can also select the relevant data through the dropdown menu.

  • Upload the necessary documents.

  • Accept the SBI e-Mudra Terms and Conditions with an e-Sign.

  • Enter your Aadhaar number.

  • Click on the captcha for using your Aadhaar for purposes of the e-Sign.

  • You will receive an OTP to your mobile number registered with your Aadhaar.

  • Enter the OTP in the required field and your application will be submitted.

Conclusion

The SBI e-Mudra Loan is a perfect fit for people who need money to meet business-related needs. The SBI e-Mudra has helped various SME business owners to grow and start businesses. The low-interest rate of this loan is one of its best features that attract many entrepreneurs. Additionally, it has contributed to the growth of GDP and has created many new job opportunities. The best part is that the e-Mudra loan is the most efficient way to get funding to realise your entrepreneurial goal as it needs no collateral.

FAQs

Both urban and rural business owners are eligible to qualify for MUDRA loans. SBI Mudra loans are also available to people who live in metropolitan areas.

A credit card with a credit limit equal to the working capital part of an SBI Mudra loan is referred to as a Mudra Loan Card or a Mudra Card. It can be used at POS terminals and as a debit-cum-ATM card for commercial purchases.

No, a subsidy is not offered under the SBI Mudra Loan.

No, under a Mudra Loan, the maximum loan amount you can avail of is up to Rs.10 lakh.

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