The Prime Minister Narendra Modi Wednesday said said that MUDRA (Micro Units Development and Refinance Agency) scheme is aimed at "funding the unfunded". 

The Prime Minister was speaking after launching the Pradhan Mantri Mudra Yojana and its logo at a well attended function at Vigyan Bhawan in New Delhi on Wednesday

PM said that while there are a number of facilities provided for the large industries in India, there is a need to focus on these 5 crore 75 lakh self-employed people who use funds of Rs 11 lakh crore, with an average per unit debt of merely Rs 17,000 to employ 12 crore Indians. He said that these facts, when brought to light, led to the vision for MUDRA Bank. 

Modi said that in our country, one often experiences that things revolve around mere perceptions, while the details often paint a different picture. Giving the example of the perception that large industries create more employment, he said that a look at the details reveals the reality that only 1 crore 25 lakh people find employment in large industries, whereas small enterprises employ 12 crore people in the country.

The Prime Minister gave examples of other small businesses that, with a little help, have the potential to grow manifold. He said that the biggest asset of the poor is his / her integrity (imaan). By combining their integrity with capital (MUDRA), it would become the key to their success. Speaking about women’s self help groups in particular, the Prime Minister said that the kind of honesty and integrity showed by these loan takers is seldom seen in any other sector.

The Prime Minister said that the small entrepreneurs of India are used to exploitation at the hands of money lenders so far, but MUDRA will instill a new confidence in them that the country is ready to support them in their efforts that are contributing so heavily to the task of nation building. He said that the established financial systems will soon move to the MUDRA-model of functioning, i.e. to support entrepreneurs that give employment to a large number of people using least amount of funds.

PM asked the bankers to study the successful micro finance models being followed in other parts of the world and try to adapt them according to the local requirements. 

Earlier speaking on the occasion, the Union Finance Minister Arun Jaitley said that this is a historical initiative by the Government to help the micro entrepreneurs to expand their business. He said that 20% of the people are dependent on micro enterprises and most of them are based on self-employment. 

Jaitley said that the basic purpose to start the Mudra bank was to 'fund the unfunded because these micro enterprises were not getting the due attention which they actually deserve. He said that the Government has already launched various schemes for the poor and vulnerable sections of the society in the form of accident insurance, life insurance and pension schemes, and now trying to ensure that health insurance schemes are also made easily accessible/extended to this section of the society.  

He said that the policy of the Government to have an industrial corridor will help in providing employment to more than 30 crore landless workers. Shri Jaitley said that under Pradhan Mantri Mudra Yojana, micro entrepreneurs will be sanctioned loans ranging from Rs. 50,000/- to Rs. 10 lakhs.

In his welcome address, Jayant Sinha, Minister of State for Finance said that this scheme has been started on the Pradhan Mantri initiative and is in tune with Sabka Saath Sabka Vikas.

The function was attended among others by Dr. Raghuram Rajan, RBI Governor, Rajiv Mehrishi, Finance Secretary, Ratan P. Watal, Expenditure Secretary, Shaktikanta Das, Revenue Secretary, Dr HASMUKH Aadhia, Secretary, Financial Services, CEOs of various Public Sector Banks and Financial Institutions and representatives of the Micro Finance Institutions from across the country among others.