PM Mudra Loan Limit Increased from ₹10 Lakhs to ₹20 Lakhs

Current Context: On October 25, 2024, the Indian government announced an increase in the loan limit under the Prime Minister Mudra Yojana (PMMY) from Rs 10 lakhs to Rs 20 lakhs.

• This initiative is aimed at enhancing the financial assistance available to micro and small enterprises, particularly for budding entrepreneurs who need substantial capital to start or expand their businesses.
• Key Details:
• Objective: The increase in the loan limit is intended to empower entrepreneurs, particularly in the micro and small enterprise sector, by providing them with the necessary financial support to scale their businesses.
• Loan Categories: Under PMMY, loans are categorized into Shishu (loans up to Rs 50,000), Kishore (loans from Rs 50,001 to Rs 5 lakhs), and Tarun (loans from Rs 5 lakhs to Rs 20 lakhs).
• Eligibility: The scheme targets non-corporate small business sectors, including manufacturing, trading, and service sectors.
• Benefits: This expansion is expected to facilitate access to credit, promote self-employment, and generate jobs across various sectors of the economy.
• Implementation: The loans will continue to be provided by Public Sector Banks, Regional Rural Banks, Scheduled Commercial Banks, and Micro Finance Institutions.
• By enhancing the loan limit, the government aims to foster a robust entrepreneurial ecosystem and ensure that financial barriers do not hinder the growth of small businesses.

Question:

1 What is the new loan limit under the Prime Minister Mudra Yojana (PMMY) as of October 25, 2024?

• A) Rs 10 lakhs
• B) Rs 15 lakhs
• C) Rs 20 lakhs
• D) Rs 25 lakhs

Answer: C) The Indian government raised the loan limit under PMMY from Rs 10 lakhs to Rs 20 lakhs to support micro and small enterprises with higher financial assistance for business growth.