Project Report for MUDRA Loan

Mudra loan is an initiative aimed to promote small scale business by providing them financial assistance under Pradhan Mantri Mudra Yojana (PMMY). Micro Units Development & Refinance Agency Ltd (MUDRA) was set up by the Government of India (GoI) for developing and refinancing all Micro-enterprises sector by supporting the finance Institutions which are in the business of lending to micro / small business entities engaged in manufacturing, trading and service activities.

What is the eligibility to get Mudra loan

Applicant should be belong to Non–Corporate Small Business Segment (NCSB). That means the borrower should be a proprietorship / partnership firm. Further, it should be a non-farming micro business

Is existing business are eligible to take Mudra Loan

Yes, existing business units are eligible to take mudra loan for expansion of their capacity

From where do you get Mudra loan

You will be required to contact the bank of your choice in your locality and not MUDRA [Micro Units Development & Refinance Agency Ltd (MUDRA) is only a refinancing institution]

How much amount will be sanctioned under Mudra scheme

Amount of loan depends on the fund requirements of your business.

MUDRA classifies the loan scheme into three based on the fund requirements and stage of business

• Shishu : covering loans upto 50,000/-
• Kishor : covering loans above 50,000/- and upto 5 lakh
• Tarun  : covering loans above 5 lakh to 10 lakh

What are document required to be submitted to get Mudra Loan

Following documents shall be submitted to get Mudra Loan

1. Application for Mudra Loan
   a. One page application for Loan under Shishu scheme
   b. Three Page application for loan under Kishor and Tarun Scheme
2. Proof of identity – Self certified copy of Voter’s ID card / Driving License / PAN Card / Aadhar Card/Passport.
3. Proof of Residence – Recent telephone bill, electricity bill, property tax receipt (not older than 2 months), Voter’s ID card, Aadhar Card & Passport of Proprietor/Partners/Directors.
4. Proof of SC/ST/OBC/Minority.
5. Proof of Identity/Address of the Business Enterprise -Copies of relevant licenses/registration certificates/other documents pertaining to the ownership, identity and address of business unit.
6. Applicant should not be defaulter in any Bank/Financial institution.
7. Statement of accounts (for the last six months), from the existing banker, if any.
8. Last two years balance sheets of the units along with income tax/sales tax return etc. (Applicable for all cases from Rs.2 Lacs and above).
9. Projected balance sheets for one year in case of working capital limits and for the period of the loan in case of term loan (Applicable for all cases from Rs.2 Lacs and above).
10. Sales achieved during the current financial year up to the date of submission of application.
11. Project report (for the proposed project) containing details of technical & economic viability.
12. Memorandum and articles of association of the company/Partnership Deed of Partners etc.
13. In absence of third party guarantee, Asset & Liability statement from the borrower including Directors& Partners may be sought to know the net-worth.
14. Photos (two copies) of Proprietor/ Partners/ Directors.

What are the contents of a project report

A project report presents the business idea and its viability to the lender. It should cover both the technical and financial aspect of the proposed business.

On a basic level, it should contain the following details

• Introduction (description about the business)
• Market Potential (a brief information about targeted market, customers, demand for the product or service etc.
• Basis and Presumptions/ Assumptions (Project report presents projected data such as expected sales, expenses, purchases etc.) In this area the assumptions and the basic facts used to prepare the project should be specified. For example – Rent is assumed to be 10000 p.m. or expenses are expected to be increased by 10% per annum.
• Technical aspects (Operational procedure has to be described under this heading. For example, if the business is for manufacturing a product, then how the raw materials will be processed, the steps to be taken to convert the raw material into finished goods etc.)
• Financial aspects (Financial aspects are the most important topic in a project report. Details such as Total Project Cost, Machinery and Equipment’s, Furniture and fixtures, working capital required, expenses, purchases, sales etc. shall be provided under this head)
• Details of suppliers (For manufactures and traders, details of raw material suppliers should be provided, if available)

A project report well prepared increases the possibility for sanctioning loan. If you need project report for your business CONTACT US 

Some tips on Mudra Loan
Chances for mudra loan increases, if the business unit is already in operation or the business unit has a shop/building for carrying out the proposed business at the time of application.