Mudra Bank aims at funding Small and Micro Entrepreneurs. Mudra (Micro Units Development and Refinance Agency) bank started on April 8 this year to support the small entrepreneurs who were in need of the finance to start or develop their business.
Most of the small or micro firms do not get full support of the banks. Many do not get the loan for their business even though they are qualified to get the amount. They go far the private banking sector or financiers and get money for high interest and they were struggling to pay the interest amount. The sources say only 4% of small/micro entrepreneurs get benefited through the present banks.
Modi government have started Mudra Bank already funded Rs. 20000 crores to over 3.7 micro and small business. Finance Minister Arun Jaitley expects the fund will rise to 1.2 lakh crores to 12.5 million entrepreneurs.
Across the nation many branches of Mudra bank have emerged and it started functioning as the subsidiary of SIDBI and IDBI banks. Its model will have the advantage over these two banks and will be aimed at funding the unfunded small business.
Mudra Bank will also responsible for refinancing small finance banks that lends money to small/micro businesses. Mudra will lay down the policy guidelines for the micro firms financing business.
In Tamilnadu, through Mudra bank nearly 2500 crores was funded to the micro/small business. Mudra in Tamilnadu planned to give the loan in 3 sections. Sisu Loan upto Rs. 50000, Kishore loan up to Rs. 5 lakhs and Dharun loan up to Rs. 10 lakhs will be given to the people. Mudra bank has been signed up with 38 public and private banks.
Through this bank common people will be benefited and micro/small business will be rise up. The people in the villages who want to start their own business will also have high benefit by this bank. For Micro/Small business firms which are engaged in manufacturing, trading and service Mudra banks will be great source.