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The 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 during the second wave of Covid-19 pandemic.

Rs 225.2 crore per day

According to the latest data the total MUDRA loan disbursed between April 1 and June 5 stood at Rs 14,864 crore out of a sanctioned figure of Rs 16,700 crore.

This means average loan amount disbursed each day is Rs 225.2 crore which is far lower than usual, but is quite high considering the pandemic-induced restrictions, say officials.

For FY18, FY19, FY20 and FY21, the average MUDRA loan disbursal per day stood at Rs 675 crore, Rs 854 crore, Rs 900 crore and Rs 725 crore respectively.

Officials hope that once the second wave is over the disbursement amount will go up, as lakhs of applications are piling up in the office itself.

Special offer

Once the second wave is over, the government is planning to make MUDRA loans more robust and accessible to the common people.

“We are considering extending the 2% interest subsidy to the immediate repayment of Shishu loans sanctioned under the Pradhan Mantri Mudra Yojana (PMMY),” a government official told the media a month ago.

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 loan is between Rs 50,000 to 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 6%.

Since 2015

MUDRA was launched in 2015 by PM 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 20%.

Data on MUDRA website shows that in FY21, disbursements stood at Rs 2.65 lakh crore, down from Rs 3.31 lakh crore in FY20.

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

The total disbursement so far has reached close to Rs 16 lakh crore.

Hope for better days

“The impact of the pandemic was clear in the disbursement figure of FY21. But we hope that with the growth in the economy in FY22, disbursement will pick up. The first two month’s trend proves that there is reason for hope,” remarked Rishabh Kothari, senior vice-president of MCC Chambers of Commerce.

“We are hoping for a good year ahead. Hope the loss we faced in FY21 can be covered up in FY22. The figure for the first two months in FY22,” said an official of the loan department requesting anonymity.