Prime Minister Narendra Modi has hailed the Mudra Yojana micro-credit scheme for enabling entrepreneurship in India. Speaking at the Uttarakhand Rozgar Mela, the prime minister said the initiative has helped around 8 crore young people to become entrepreneurs for the first time, with 38 crore Mudra loans issued across India to date.
The prime minister said the maximum share of these loans went to women and young people from SC/ST/OBC classes. He added that the Mudra Yojana is helping to boost employment and self-employment in tourism, with those engaged in businesses such as shops, dhabas, guest houses, and homestays able to obtain loans up to INR10 lakh ($133,230) without guarantees.
Data shared by the Minister of State in the Ministry of Finance Bhagwat Karad in the Lok Sabha on February 13 showed that over 38.58 crore loans were extended from the inception of the scheme in April 2015 until January 27, 2023. Over 26.35 crore loans were extended to women entrepreneurs, accounting for 68% of the total, and 19.84 crore loans were extended to SC/ST/OBC category borrowers, accounting for 51%.
The scheme offers collateral-free institutional credit to individuals with a business plan in the manufacturing, trading, services, and agriculture sectors. Loans are available under three products: Shishu (up to INR50,000), Kishore (over INR50,000 and up to INR5 lakh), and Tarun (over INR5 lakh and up to INR10 lakh).
The initiative aims to provide entrepreneurs with access to finance and boost job creation in the country. According to Karad, lenders had disbursed Mudra loans of INR17.35 lakh crore ($231.52 billion) between April 1, 2017, and November 25, 2022, and the portfolio quality of Mudra lenders showed non-performing assets relating to Mudra loans of 3.17% of the credit disbursed as of March 2022.
In his address, the prime minister said the government is working to ensure every young person has access to opportunities based on their interests and abilities, and to provide the right medium to help them progress.