Page 18 - MUDRA ANUBHAV

To make the process even easier for the beneficiary,
the need to for documentation has been made easy
and convenient, which many a times hinders the

process of availing finance. While the financing
institutions are insisted to carry out their routine
Know Your Customer (KYC) process, the requirement
of collaterals for loans under MUDRA scheme is nil,

which supports the idea of Funding the Unfunded.
Many a times small businesses do not have assets
to provide as security. Especially if the business is
new, they may not have an opportunity to create

or own an asset in first place to provide the same
as security. Waiver of requirement of security
based on assets is a very relieving proposition for
the borrowers. Also, there is no processing fee for

MUDRA loans, which otherwise creates additional
financial burden on the borrowers.

According to the annual report of MSME for the
year 2020-21, there are about 633.88 lakhs

MSMEs in India. Out of above 630.52 lakhs are
Micro Enterprises. These are essentially the small
businesses which have just started or have been
passed on in families without much expansion in

size. These businesses require tremendous support
in terms of finance. MUDRA aims to provide
support to these small businesses and fulfill the
aim of financial inclusion.

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