Key Facts About Mudra Loans
- No Collateral Required: Mudra loans are 100% unsecured. Banks are not allowed to ask for collateral or third-party guarantees for loans up to ₹10 Lakhs.
- No Processing Fees: For the "Shishu" and "Kishore" categories, banks generally waive all processing fees. A nominal fee may be charged for the Tarun category.
- Who can apply? Any Indian citizen who has a business plan for a non-farm sector income-generating activity such as manufacturing, processing, trading, or service sector, and whose credit need is less than ₹10 lakh can approach a Bank, MFI, or NBFC for a MUDRA loan.