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Finance Ministry is planning to give statutory status to MUDRA Bank

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  • Finance Ministry is planning to propose a bill in next budget session for giving statutory status to MUDRA Bank.
  • MUDRA Bank will act as a regulator for micro finance institutions and will take care of laying down policy guidelines for micro enterprise financing business as well as registration of MFIs, their accreditation and rating
  • Currently NBFC executes existing Pradhan Mantri Micro Units Development and Refinance Agency (MUDRA) Yojana.
  • Under PMMY, NBFC is financing 5.75 crore self-employed provides loans between Rs 50,000-Rs 10 lakh to small entrepreneurs.
  • Through legislation NBFC will be converted as MUDRA Bank.
  • MUDRA Bank provides 3 products under the PMMY. They are Shishu covers loans up to ₹50,000, Kishor covers above ₹50,000 and up to ₹5 lakh and Tarun above ₹5 lakh and up to ₹10 lakh, to signify the stage of growth and funding needs of the beneficiary micro unit or entrepreneur.

Source: ET

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