'Bank for SMEs 'MUDRA' finalizing interest rates and schemes'

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SME Times News Bureau | 09 May, 2015
Micro Units Development Refinance Agency (MUDRA) Bank, aims at providing credit of up to Rs 10 lakh to small entrepreneurs, is finalizing its schemes and rate of interest, Minister of State in Ministry of Finance, Jayant Sinha informed in written reply to a question in the Lok Sabha on Friday.

He said, "MUDRA is finalizing it schemes and rate of interest. The present initiative of the Government in promoting MUDRA will help in providing self-employment and financial assistance to micro units in the country."

The Union Finance Minister in the Union Budget 2015-16 announced to set up a Micro Units Development Refinance Agency (MUDRA) Bank through a statutory enactment, with a corpus of Rs.20,000 crore, and credit guarantee corpus of Rs. 3,000 crore.

MUDRA Bank will refinance Micro-Finance Institutions through a Pradhan Mantri Mudra Yojana (PMMY). In lending, priority will be given to SC/ST enterprises.

Pending passing of legislation by Parliament, Micro Units Development Refinance Agency Ltd., which is wholly owned subsidiary of Small Industries Development Bank of India (SIDBI), has been launched on April 8, 2015 by the Prime Minister as a Non-Banking Financial Institution (NBFI).

The minister said that the MUDRA is intended to provide refinance support to Last Mile Financiers (LMFs) such as Non-Banking Finance Companies (NBFCs) engaged in financing micro business etc; which are in the business of lending to micro business entities engaged in manufacturing, trading and service activities.

MUDRA shall be refinancing the LMFs spread across the country, which cover both urban and rural areas and extend financial assistance to self employment, micro units as per the requirements, he added.