Categories: Economy

GoI cuts Mudra loans target to Rs 3 trillion in FY22

The government has set the loans disbursement target under the PM Mudra Yojana (PMMY) at Rs 3 trillion for 2021-22 (FY22). This target is lower than the previous year. For FY21, the target was set at Rs 3.21 trillion. Experts attribute the lower target to increased allocation under the credit guarantee scheme for small businesses.

Under PMMY, credit up to Rs 10 lakh is provided by banks and non-banking financial companies for entrepreneurial activities to small business units, including for new enterprises in sectors such as manufacturing, trading, services and activities allied to agriculture. The central government allocates annual targets for sanctioning of loans under the scheme. In FY22, loans worth Rs 3,804 crore have been sanctioned by 13 public sector banks (PSBs) as of June 25.

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About the PMMY:

Pradhan Mantri Mudra Yojana (PMMY) is a scheme to extend collateral-free loans by Banks, Non-Banking Financial Companies (NBFCs) and Micro Finance Institutions (MFIs)   to Small/Micro business enterprises and individuals in the non-agricultural sector to enable them to set up or expand their business activities and to generate self-employment. The maximum limit of the loan is Rs 10 lakh. MUDRA stands for Micro Units Development & Refinance Agency Ltd.

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Sumit Arora

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