Hello friends, welcome to Motivational Banker, your one-stop solution for all JAIIB and CAIIB-related queries. Today, we’ll discuss the recent updates to the Pradhan Mantri Mudra Yojana (PMMY) that were announced in the Union Budget. Let’s dive into these updates.

Feel free to watch the video to listen in Hindi or read the blog in English –

New Loan Limit

As announced in the Union Budget, the loan limit under the PMMY has been increased from ₹10 lakh to ₹20 lakh. This significant increase is designed to help entrepreneurs access greater financial support for their ventures.

Introduction of ‘Tarun Plus’ Category

Previously, PMMY had three categories:

1. Shishu: Loans up to ₹50,000.
2. Kishor: Loans between ₹50,000 and ₹5 lakh.
3. Tarun: Loans from ₹5 lakh to ₹10 lakh.

Now, a fourth category has been added – ‘Tarun Plus.’

• Under this new category, entrepreneurs who have successfully repaid their Tarun loans (₹10 lakh) are eligible to receive loans up to ₹20 lakh.
• This aims to encourage timely loan repayment and provide additional funding for expanding businesses.

Guarantee Coverage

All loans under the PMMY, including the new ‘Tarun Plus’ category, are covered under the Credit Guarantee Fund for Micro Units (CGFMU). This means:

• Banks and financial institutions can offer loans without the need for collateral.
• Entrepreneurs can focus on growing their businesses without worrying about security requirements.

Key Highlights

• The revised categories under PMMY are now:
  • Shishu: Up to ₹50,000.
  • Kishor: ₹50,000 to ₹5 lakh.
  • Tarun: ₹5 lakh to ₹10 lakh.
  • Tarun Plus: ₹10 lakh to ₹20 lakh.
• Loans provided under this scheme are backed by the CGFMU, ensuring the bank’s confidence in disbursing funds.

Who is Eligible for Tarun Plus?

Eligibility for the new Tarun Plus category is specific:

• Entrepreneurs who have successfully repaid their ₹10 lakh loans under the Tarun category.
• Those with smaller loans (e.g., ₹5 lakh under Kishor) will first need to move to the Tarun category and repay their loans before qualifying for Tarun Plus.

Exam-Oriented Questions

For those preparing for banking exams, here are some key questions:

1. What is the new loan limit under Mudra Yojana?
   • Answer: ₹20 lakh.
2. Who is eligible for the Tarun Plus category?
   • Answer: Entrepreneurs who successfully repaid their Tarun loans.
3. Under which fund is the guarantee coverage provided for Mudra loans?
   • Answer: Credit Guarantee Fund for Micro Units (CGFMU).

Important Note on PMJDY Loans

Under the Pradhan Mantri Jan Dhan Yojana (PMJDY), loans of up to ₹10,000 given to customers are also covered under the Credit Guarantee Fund. This provides added security for banks while disbursing these loans.

Conclusion

With the addition of the Tarun Plus category and the increase in the loan limit, the Pradhan Mantri Mudra Yojana continues to empower small entrepreneurs and support economic growth. Remember, timely repayment of loans not only boosts your creditworthiness but also opens up opportunities for higher funding.

I hope this information helps you in your exams and general banking knowledge. Thank you for reading! 😊