Ministry of Finance
PM Mudra Loan Yojana 2026 – Business Loan Up to ₹20 Lakh Without Collateral
Objective
PM Mudra Loan Yojana (PMMY) provides collateral-free micro and small business loans to non-farm entrepreneurs, self-employed individuals, and startups — enabling them to start or expand businesses without needing property as security.
Eligibility Criteria
- Indian citizens who are non-farm micro or small entrepreneurs
- Self-employed individuals, sole proprietors, partnership firms, and small businesses
- Startups and new businesses in manufacturing, trading, and service sectors
- Existing businesses seeking working capital or expansion loans
- No minimum income criterion — income potential of the business is assessed
- Women entrepreneurs, SC/ST applicants, and NE region applicants get priority consideration
Benefits & Features
- 1Shishu: Loans up to ₹50,000 — for micro businesses and first-time borrowers
- 2Kishore: Loans from ₹50,001 to ₹5 lakh — for growing small businesses
- 3Tarun: Loans from ₹5 lakh to ₹10 lakh — for established businesses needing expansion
- 4Tarun Plus: Loans from ₹10 lakh to ₹20 lakh — for Tarun borrowers with good repayment track record
- 5No collateral required for Shishu and Kishore loans
- 6Competitive interest rates as per lending bank (typically 8–12% per annum)
- 7Mudra Card — a debit card for withdrawing working capital as needed
Required Documents
- Aadhaar card and PAN card
- Business address proof (electricity bill, lease agreement, or shop registration)
- Business plan or loan purpose description
- Bank statements of last 6 months
- Photographs of the business/shop
- Caste certificate (for SC/ST applicants to avail priority)
- Income proof (ITR or self-declaration for new businesses)
How to Apply
Frequently Asked Questions
| What is the Tarun Plus category in PMMY 2026? | Tarun Plus is a new category introduced in FY 2024-25 for borrowers who have already availed and repaid a Tarun loan. It offers loans from ₹10 lakh to ₹20 lakh. |
| Is collateral required for PMMY loans? | No collateral is required for Shishu (up to ₹50,000) and Kishore (up to ₹5 lakh) loans. For Tarun and Tarun Plus, some lenders may ask for a guarantor or business assets as security. |
| Can an employee apply for Mudra Loan? | No. PM Mudra is only for self-employed and business owners — not for salaried employees. Personal loans, education loans, and consumer loans are not covered. |
Official Portal & Helpline
1What Is PM Mudra Loan?
Starting a small business or expanding your existing shop in India has always hit the same wall — banks won't lend without collateral, and moneylenders charge 30-40% interest. PM Mudra Loan (PMMY) was built to break that wall.
Launched in 2015, Pradhan Mantri Mudra Yojana now disburses over ₹5 lakh crore in loans annually. In 2026, the scheme offers four loan categories going up to ₹20 lakh — completely without mortgage or property security for the lower categories.
2Four Loan Categories — Which One Is Right for You?
| Category | Loan Amount | Who It's For |
|---|---|---|
| Shishu | Up to ₹50,000 | New micro business, vegetable vendors, home workshops |
| Kishore | ₹50,001 – ₹5 lakh | Growing business needing working capital or machinery |
| Tarun | ₹5 lakh – ₹10 lakh | Established business with expansion plans |
| Tarun Plus | ₹10 lakh – ₹20 lakh | Existing Tarun borrowers with good repayment track record |
Most first-time applicants start with Shishu or Kishore.
3Who Can Apply?
- Street vendors, shopkeepers, tailors, small manufacturers
- Food processing, beauty saloons, transport businesses
- Artisans, craftspeople (combined with PM Vishwakarma)
- Women self-help groups and micro-entrepreneurs
- Startups in trading and services (not agriculture)
You cannot apply if you are:
- A salaried employee
- Applying for a personal or education loan
- Running an agricultural/farming business (Kisan Credit Card is for that)
4How to Apply — Online & Offline
Online:
- Visit jansamarth.in — India's unified loan portal
- Or go to udyamimitra.in
- Select Mudra Loan → fill business details → submit documents
- Bank contacts you within 5–7 working days
Offline: Walk into any of these with your documents:
- Public sector bank (SBI, PNB, BOB, Canara, etc.)
- Private bank (HDFC, ICICI, Axis, etc.)
- Microfinance Institution (MFI) or NBFC
- Small Finance Bank
5The Mudra Card — Working Capital Made Easy
After loan approval, eligible borrowers get a Mudra Card — a debit card tied to a revolving credit limit. Instead of taking the full loan upfront, you draw money as you need it (like a business credit card) and pay interest only on what you use. This is especially useful for working capital — buying raw materials or stock.
6Interest Rates and Repayment
Interest rates on Mudra loans are set by individual banks — there is no fixed government rate. Current typical rates:
- PSU banks: 8–10% per annum
- Private banks/NBFCs: 10–14% per annum
Repayment tenure: typically 3–5 years with monthly EMIs. There is no prepayment penalty.
Pro tip: Apply at a public sector bank where you already have a savings account — approval is faster because they can verify your transaction history directly.