Union Budget 2024: Government doubles Mudra loan limit to Rs 20 lakh to promote entrepreneurship

The government is committed to the all-round, all-pervasive, and all-inclusive development of people, particularly farmers, youth, women, and the poor, Finance Minister Nirmala Sitharaman said while presenting the Union Budget 2024.

In a bid to promote entrepreneurship in the country, Finance Minister Nirmala Sitharaman on Tuesday doubled the upper limit of Mudra loans to Rs 20 lakh.

"The limit of Mudra loans will be enhanced to Rs 20 lakh from the current Rs 10 lakh for those entrepreneurs who successfully repaid previous loans under the 'Tarun category', she said while presenting the Union Budget 2024 in the Lok Sabha.

Prime Minister Narendra Modi launched the Pradhan Mantri MUDRA Yojana (PMMY) in 2015 to facilitate easy, collateral-free micro-credit of up to Rs 10 lakh for non-corporate, non-farm small and micro-entrepreneurs. The loans are provided by Member Lending Institutions (MLIs), banks, non-banking financial companies (NBFCs), microfinance institutions (MFIs), and other financial intermediaries collateral-free up to Rs 10 lakh under three categories: Shishu (up to Rs 50,000), Kishore (between Rs 50,000 and Rs 5 lakh), and Tarun (Rs 10 lakh).

"Our government is committed to the all-round, all-pervasive, and all-inclusive development of people, particularly farmers, youth, women, and the poor," Sitharaman said while presenting the Union Budget 2024.

The saturation approach of covering all eligible people through various programmes will be adopted in a bid to empower them, she said.

The implementation of schemes meant for supporting economic activities by craftsmen, artisans, self-help groups, scheduled castes, scheduled tribes, women entrepreneurs, and street vendors will be stepped up, the Finance Minister said in her Union Budget 2024 speech.

To improve the socio-economic condition of tribal communities, the government will launch the Pradhan Mantri Janjatiya Unnat Gram Abhiyan by adopting saturation coverage for tribal families in tribal-majority villages and aspirational districts. This will cover 63,000 villages benefitting five crore tribal people, the minister said.

In her Union Budget 2024 speech, Sitharaman added that the Small Industries Development Bank of India (SIDBI) will open new branches to expand its reach and serve all major Ministry of Micro, Small and Medium Enterprises (MSME) clusters within three years and provide direct credit to them.

With the opening of 24 such branches this year, the service coverage will expand to 168 out of 242 major clusters, Sitharaman stated in the Union Budget 2024 speech.

(With PTI inputs)