Union Bank of India offers Mudra loans under the Pradhan Mantri Mudra Yojana (PMMY) to provide financial support to non-farm, micro, and small businesses in India.1 These loans are designed to be accessible and collateral-free, helping entrepreneurs in the manufacturing, trading, and services sectors.2
Key Features and Loan Categories
Union Bank of India’s Mudra loans are categorized based on the loan amount, catering to different stages of a business.
- Shishu: Loans up to ₹50,000 for new businesses or those in their initial phase.3
- Kishore: Loans ranging from ₹50,001 to ₹5 lakh for businesses that are established and need funds for expansion.4
- Tarun: Loans from ₹5 lakh to ₹10 lakh for businesses that are well-established and looking to grow.5
- Collateral-free: No collateral or third-party guarantee is required, making it easier for small businesses to access credit.6
Eligibility Criteria
To be eligible for a Union Bank of India Mudra loan, applicants must meet certain criteria:
- The business must be a non-farm micro-enterprise.7
- The applicant must be an Indian citizen.
- The applicant should not have any past loan defaults with any bank or financial institution.8
- The business should be involved in the manufacturing, trading, or services sector.9
Visit : https://www.unionbankofindia.co.in/en/details/union-mudra
Required Documents
The documents needed for the application generally include:
- Identity Proof: Aadhaar Card, PAN Card, Voter’s ID, Passport, etc.10
- Address Proof: Utility bills (electricity/telephone), Aadhaar Card, Passport, etc.11
- Business Proof: Relevant licenses, registration certificates, or other documents verifying the business’s existence and address.
- Photographs: Recent passport-sized photographs.12
- Bank Statements: Last six months’ bank statements.13
- Financial Documents: For Kishore and Tarun loans, you may need to provide financial statements, Income Tax Returns (ITR) for the last two years, and a business plan.
Application Process
You can apply for a Mudra loan from Union Bank of India through both online and offline channels:
- Online Application: The bank offers a “Straight Through Processing” (STP) for Shishu, Kishore, and Tarun loans, which allows you to apply online through their website.14
- Offline Application: You can visit a Union Bank of India branch, fill out the Mudra loan application form, and submit it with all the necessary documents.15
Interest Rates and Repayment
- Interest Rates: The interest rate for Mudra loans from Union Bank of India is determined by the bank’s internal policies and is linked to the Base Rate. The rate can vary based on the loan category and the applicant’s profile.
- Repayment: The repayment period can be flexible, typically up to 5 years, with the option of a moratorium period.16 The exact terms are based on the business’s cash flow.
It is recommended to check with the bank directly or visit their official website for the most current information regarding interest rates and specific loan requirements.
