To fund the unfunded, self employed and small business, a new institution called MUDRA has been launched on 7th April by our Prime minister which would offer loans upto Rs. 10 lakh at low rate of interest. This PM’s MUDRA yojna has a corpus of Rs. 20,000 crores and can lend money between Rs. 50,000 to Rs. 10 lakhs to small entrepreneurs, micro finance institutions and non banking finance companies (NBFC). They can raise loans from MUDRA in lending to borrower’s. For the time being, MUDRA has been registered as a NBFC with RBI but with in a year, Govt. intents to convert this MUDRA with a legislative measure in to a bank. This MUDRA would act as a Subsidiary of SIDBI.
The Purpose of MUDRA is to create more micro finance institutions which could meet credit requirements of poor people. It is also expected to laying down policy guidelines to to micro finance business, registration of micro finance institutions including their accrediation and ratings. This MUDRA is expected to provide refinance to banks and other institutions at the rate of 7%. The MUDRA’s board would decide the optimum rates at which institutions getting refinance would lend to ultimate borrowers. It CEO has already been appointed and it is expected to gear up the task assigned. It is a good hope for poor people who are linked to micro finance institutions, self help groups as well as other financing institutions working in financing the poor.