New Delhi | Prime Minister Narendra Modi today launched Mudra Bank with a refinance corpus of Rs 20,000 crore to finance the non-corporate small businesses.
The Micro Units Development Refinance Agency (MUDRA) Bank which will also have credit guarantee corpus of Rs 3,000 crore has been set up under the Pradhan Mantri Mudra Yojna. Under the scheme, the micro entrepreneurs will be sanctioned loans ranging from Rs 50,000 to Rs 10 lakh.
Launching the scheme, the Prime Minister said while there are a number of facilities provided for the large industries in India, there is a need to focus on these 5.75 crore 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 the policy of the Government to have an industrial corridor will help in providing employment to more than 30 crore landless workers.
He said these facts when brought to light led to the vision for MUDRA Bank.
Mr Modi said ”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 1.25 crore people find employment in large industries, whereas small enterprises employ 12 crore people in the country.
Speaking about womens self help groups in particular, the Prime Minister said the kind of honesty and integrity showed by these loan takers was seldom seen in any other sector.
He said the small entrepreneurs were used to get exploited at the hands of money lenders so far, but MUDRA would instill a new confidence in them that the country was ready to support them in their efforts that were contributing so heavily to the task of nation building.
Mr Modi said 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.
Earlier, Finance Minister Arun Jaitley said 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.
It is to be set up through a statutory enactment and would be responsible for developing and refinancing all Micro-finance Institutions (MFIs) which are in the business of lending to micro small business entities engaged in manufacturing, trading and service activities through a scheme namely Pradhan Mantri MUDRA Yojana.
The bank would also partner with state regional level co-ordinators to provide finance to last mile financiers of small micro business enterprises.
The products initially being launched are sector activity specific schemes, such as, schemes for business activities in land transport, community, social and personal services, food product and textile product sectors.
MUDRA would also adopt a credit plus approach and take up interventions for development support across the entire spectrum of beneficiary segments.
In addition, following facilities are also envisaged such as MUDRA card, portfolio credit guarantee and credit enhancement.
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