Important Points about MUDRA Bank- GK Updates:
Micro Units Development and Refinance Agency Ltd (MUDRA) were launched by PM Modi to fund the small entrepreneurs. The Bank was launched under the ambitious Pradhan Mantri Jan Dhan Yojana (PMJDY).
· This Bank will provide credit of up to Rs. 10 lakhs for small entrepreneurs and act a regulator for Micro-Finance Institutions (MFIs).
· Union Finance Minister Arun Jaitely had proposed the creation of a Micro Units Development Refinance Agency (MUDRA) Bank with a corpus of 20000 crore rupees and credit guarantee corpus of 3000 crore rupees during the presentation of Union Budget 2015-16 on 28th February 2015.
Functions of MUDRA Bank:
· Lay down policy guidelines for micro enterprise financing business.
· Registration of MFI entities
· Accreditation/rating of MFI entities
· Lay down responsible financing practices toward off over indebtedness and ensure proper clients protection principles and methods of recovery.
· Development of standardized set of covenants governing last mile lending to micro enterprises.
· Promoting right technology solutions for the last mile.
· Formulating and running a credit guarantee scheme for proving guarantees to the loans/ portfolios which are being extended to micro enterprises.
· Support development& promotional activities in the sector.
· Creating a good architecture of last Mile Credit Delivery to micro business under the scheme.
· It would partner with State/Regional level coordinators to provide finance to Last Mile Financiers of small/micro business enterprises.
Products Offered by MUDRA Bank:
· The bank will initially offer products like Shishu, Kishor and Tarun to differentiate the stage of growth and funding needs of the beneficiary entrepreneur.
· Shishu will cover loans up to 50000 rupees.
· Kishor will cover loans above 50000 rupees and up to 5 lakh rupees.
· Tarun will cover loans above 5 lakh rupees up to 10 lakh rupees.
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