Pradhan Mantri Mudra Yojana has granted over 32.11 crore loans totaling Rs. 17 lakh crore, with disbursements of Rs. 16.50 lakh crore

According to data posted by Member Lending Institutions (MLIs) on the Mudra portal as of 26.11.2021, over 32.11 crore loans totaling Rs. 17 lakh crore with disbursements of Rs. 16.50 lakh crore have been extended under the Pradhan Mantri Mudra Yojana (PMMY) since its launch in April 2015. Dr Bhagwat Kisanrao Karad, Union Minister of State for Finance, revealed this in a written reply to a question in Rajya Sabha today.

The Minister noted that year-by-year information of loans issued under various categories of PMMY, namely Shishu (loans up to Rs. 50,000), Kishore (loans between Rs. 50,001 and Rs. 5 lakh), and Tarun (loans between Rs. 5 lakh and Rs. 10 lakh), are ANNEXED.

The Minister added, after listing a number of studies conducted to assess the impact of PMMY:

(i)In 2016-17, “Micro Save”, a financial inclusion consulting group, conducted an impartial assessment of PMMY. Among the important conclusions are the following:

• PMMY loans are appealing to borrowers since they do not demand a guarantor or security, have simple documentation and speedy processing, and lenders take a proactive approach.
• PMMY loans have assisted borrowers in expanding the scope and profitability of their businesses; and
• Shishu loans have helped small shop owners and vendors realise their full business potential by satisfying their working capital needs.

(ii) In 2016-17, the IFMR Finance Foundation (IFF) performed a study to better understand the impact of PMMY. The following are some of the study’s significant findings:

• PMMY has resulted in a large increase in bank credit to MSMEs, notably loans of less than Rs. 2 lakh. Microfinance Institutions (MFIs) are collaborating with banks to expand the accessibility of loans under Rs. 2 lakh.
• In 2016-17, the average loan size granted by banks in the Shishu category increased significantly (by approximately 50%). Existing clients are more likely to receive higher loans, according to data. MFIs have seen an increase in loan size in the Kishore category.
• PSBs and RRBs are more aware of the important qualities of PMMY loans, and banks have greatly liberalised criteria in order to reach out to more borrowers.

(iii) To assess employment generation under PMMY, the Ministry of Labour and Employment (MoLE) performed a comprehensive sample survey at the national level. According to the survey results, PMMY contributed to the creation of 1.12 crore net extra jobs over a three-year period (i.e. from 2015 to 2018). Overall, the Shishu loan category accounts for around 66 percent of new employment generated by establishments owned by MUDRA recipients, followed by the Kishore (19 percent) and Tarun (15 percent) loan categories.