MUDRA Loan Project Report – How To Prepare

Introduction to project report for Mudra Loan

The Government of India has sanctioned 5.83 crore loans worth Rs 3.23 lakh crore through Micro Units Development and Refinance Agency or MUDRA, a public financial institution. MUDRA was initiated under the guidance of Pradhan Mantri Mudra Yojana (PMMY) in 2015 to support in terms of credit to small businesses in the non-corporate sector. A wholly-owned subsidiary of the Small Industries Development Bank of India, also known as SIDBI, MUDRA is a non-banking financial company (NBFC) that not only helps those planning for their entrepreneurial journey for starting a new business but also lends capital for the expansion of existing businesses.

A step by step guide to preparation of MUDRA Loan project report

Our financial lending system is considered to be widespread in the world. However, the main population is unable to gain assistance when they require it. A solution in this segment is very crucial presently. A formal financial system was created by the Government in the year 2015, called Pradhan Mantri Mudra Yojana (PMMY) for providing affordable credit to all companies. Many set-ups even today strive without sufficient financial resources and tend to collapse away over some point in time.

MUDRA Loan scheme

The MUDRA loan scheme is a well-known one that lends financial support of about Rs. 50,000 to non-corporate companies. Firms involved in manufacturing, allied agricultural activities, services, retail, and so on can avail of MUDRA loans to capitalize on their various requirements. Micro units and businessmen who apply for MUDRA loans can get a loan amount up to Rs. 10 Lakhs with comparatively lower interest rates, which differ from one bank to another. Submitting a project plan for a MUDRA loan including the necessary documents at the time of application is significant for your loan approval.

MUDRA helps refinance the financiers or financial organizations helping small businesses such as co-operative societies, small banks, trusts, commercial banks, and rural banks. If you are looking to start a micro, small, or medium unit, you can approach MUDRA loans from banks at reasonable rates of interest. To do so, you must have an idea about the MUDRA loan project report model which will intern support the business financially.

To acquire a MUDRA loan, the borrower must submit a project report to the public sector undertaking from whom the loan is availed. Important details associated with your business such as company background, procurement of raw materials, nature of activities, manpower, profit, ROI should be mentioned carefully in the project report for the MUDRA loan.

The report must be to-the-point, precise, understandable, and include all necessary detailing about the start-up or business. This is because it helps the lender to have the first impression of your idea. Masking facts or giving false details or any other kind of misrepresentation can not only cause rejection of your loan but also impact your CIBIL score. If you are applying for a loan under the PMMY, it is recommended that you create a proper project report explicating your personal and professional information to make yourself an attractive candidate for MUDRA loans.

Components of MUDRA Loan project report

While preparing the project report, to get a MUDRA loan you have to make sure to add the key elements. These elements are essential for the MUDRA loan project report, which include:  

• Aim/Objective: In this, you have to describe the aim of your company or the vision on which it was established and lasts to work till date.

• Expertise Area: Describe the essential skills that your employees have in your organization or the desired ones. 

• Budget or Financial structure: Clear investment expenses of the project in hand or the existing company’s complete financial information.

• Equipment details: Present the list of tools, machines, machinery, plants, parts, etc. required for the company or for the unit setup that is required for the business.

• Commercial details: Your future plans about the company which will be commenced to commercialize a start-up or to run an existing one.

• Profile of the Firm: Details about the foundation of the company, achievements, or key milestones, to date can be included under this firm.

• Order Details:  If you have received export orders from any domestic or international systems you can mention the corresponding details in this section.

• Employee Info: Detailed information or data about the number of employees in your organization along with the projects on which they are working.

• Logistics: Information about transportation costs, even though it is commercial or private.

• Advertising and Marketing: Promotional strategies used towards marketing the product of your company etc. 

Other details about MUDRA Loan scheme

Apart from these, information of products or services obtained, manufacturing processes undertook, third party information, land used for business or commercial area utilized should also be included. This should be concluded with a significant conclusion of the project plan for the MUDRA loan. 

MUDRA loan project report model rules

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You can easily get sponsored by following the MUDRA loan project report model rules and begin your entrepreneurial journey. However, if you requiring some additional funds or do not qualify for a MUDRA loan under PMMY, then try to opt for a business loan of up to Rs. 30 Lakhs that could be available on Finserv MARKETS without any security or collateral. You can opt for a repayment tenure of your choice that could be about 1-5 years.

The entire application process can be done online which makes it hassle-free and easy as you can feasibly apply for a Bajaj Finserv Business loan available on Finserv MARKETS without waiting in long queues in the bank. Moreover, you can have a free Financial Health Check Report (FHCR) to assist you in maintaining track of your business goals and even get tailored insurance plans to secure you against unanticipated risks in the long run.

Bank offers loans for this scheme called Mudra Loan Scheme. The specific details are listed below.

• The loan is sanctioned to non-farming segments after 8th April 2015.
• The limit of this loan is about Rs. 10 lacs.
• Mudra Loans are also provided for service, manufacturing, and trading operations.
• There is no collateral security required.
• The loan does not need any guarantee and thus it is easily accessible to the people.

Different types of Mudra Loans to prepare a project report

There are different types of Mudra Loans which are mentioned below:

• Shishu Loans till Rs. 50,000
• Kishore Loans between Rs. 50,000 – Rs. 5 lacs
• Tarun Loans from Rs. 5 lacs and Rs. 10 lacs

Documents required for Mudra Loan

The documentation needed for applying to a Mudra Loan is summarized below.

Shishu Category (up to Rs. 50,000)

• Proof of identity – Self-attested copies of Voter’s ID card, PAN Card, Driving License, Aadhaar Card, Passport, Photo Ids issued by Government authority, etc.
• Residence Address Proof – Copies of latest telephone bill, Aadhaar Card, property tax bill, electricity bill, Voter’s ID card, Passport of Individual, Proprietor, Partners, Certificate issued by Government Authority, Municipality, Local Panchayat, etc. These should be on the applicants’ names.
• Applicant’s recent passport photograph (2 copies) not older than 6 months. 
• Proof of SC/ST/OBC/Minority, if required. 
• Address Proof of the Business Enterprise where you have set up your business. 
• Statement of Account from the present Banker for the past last six months if any. 
• Quotation of Equipment / other items to be procured.

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Kishore (Rs. 50,000 up to Rs. 5 lacs) and Tarun Category (Rs. 5 lacs up to Rs.10 lacs)

• Proof of identity – Self-certified copy of Voter’s ID card, Passport, PAN Card, Driving License Aadhaar Card, any photo Ids allotted by the government.
• Proof of Residence – Recent telephone bill, a property tax receipt (not older than 2 months), electricity bill, Voter’s ID card, Passport of Individual/ Proprietor/Partners, Aadhaar Card, Certificate issued by Local Panchayat / Govt. Authority/Municipality etc.
• Proof of SC/ST/OBC/Minority, if needed. 
• Proof of Identity / Address of the Business Enterprise – Copies of relevant Licenses/lease or Rent agreement/ Registration Certificates / Other Documents about the ownership, identity of the address of business unit / Udyog Aadhaar Memorandum.
• Statement of Account from the present Banker for the past six months, if any. 
• Last two years unaudited balance sheets of the prevailing units including income tax /sales tax returns etc. (Applicable for loans of Rs. 2 lacs and more).
• Estimated balance sheets of your start-ups or existing business units of a year in case of working capital limits (Applicable for loans of Rs. 2 lacs and more).
• Sales attained during the ongoing financial year till the date of submission of the application (in case of prevailing units).
• Proforma Invoices/Quotations for the assets that should be obtained and estimation for the civil works, if any to be undertaken. Factors like technical feasibility and economic viability could be discussed with the borrower if needed.
• Asset and Liability document of the borrower including Directors and Partners. 
• Memorandum and Articles of association of the organization/Partnership Deed, etc. wherever needed.
• Two passport size photos of applicant/Proprietor/ Partners/ Directors not older than 6 months.

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