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The second wave of the Covid pandemic has pushed the economy to rock bottom. However, disbursements of MUDRA (Micro Units Development and Refinance Agency) loans, a vehicle of the Union government to foster grassroots-level entrepreneurship and self-employment in the country, witnessed a sharp rise.

Rs 401 crore per day

According to the latest government data, the total MUDRA loan disbursed between April 1 and July 16 stood at Rs 42,888 crore out of a sanctioned figure of Rs 48,619 crore. This works out to an average daily disbursal of Rs 401 crore in the first 107 days of the year.

For FY18, FY19, FY20 and FY21, the average MUDRA loan disbursal per day stood at Rs 675 crore, Rs 853 crore, Rs 903 crore and Rs 854 crore, respectively.

Officials say that once the second wave is over the disbursement amount will go up, as applications are piling up.

Path ahead

“We are considering extending the 2% interest subsidy to the immediate repayment of Shishu loans sanctioned under the Pradhan Mantri Mudra Yojana (PMMY) from this year onward,” a government official said in June.

There are three categories of loans under the MUDRA scheme. The smallest one titled “Sishu” entitles one to a loan of Rs 50,000. The next level of the loan is between Rs 50,000 and Rs 5 lakh and is called “Kishore”, the third category called “Tarun” is from Rs 5 lakh to Rs 10 lakh.

The loanee does not need to submit collaterals for these loans. The annual rate of interest varies from 8.2% to 9.65%. The government is planning to reduce it to around 6.5%.

Total Rs 15.6 lakh crore

MUDRA was launched in way back 2015 by Prime Minister Narendra Modi with a dream of making more and more small entrepreneurs in India.

Since then, the loan disbursement amount has steadily gone up. FY21 was the first year when the figure suffered a dip by over 5.5%.

Data on the MUDRA website shows that in FY21, disbursements stood at Rs 3.11 lakh crore, down from Rs 3.30 lakh crore in FY20.

In FY19, an amount of Rs 3.11 lakh crore and in FY Rs 2.47 lakh crore was disbursed. Since FY16, MUDRA loan disbursement has witnessed a sharp increase of 32%, 41%, 27% and 6% in the next four financial years, respectively.

The total disbursement so far, i.e. from FY 16 to FY 22 (July 16) has reached close to Rs 15.6 lakh crore.

Bottom line

“The impact of the second wave of the pandemic is very limited on the disbursement figure of FY22. We hope that with the growth in the economy in FY22, the disbursement will pick up to another level. The first quarter trend proves that there is a reason for hope for the remaining period,” remarked Avik Roy of Bharat Chambers of Commerce.

“We are hoping for a good year. The dip we faced in FY21 can be covered in FY22 in every sector including the making of new entrepreneurship. The figure of the first three and half months in FY22 is encouraging,” said Subhasish Roy from MCC Chamber of Commerce and Industry.