PSU Banks to organize Mega Credit Campaign for Micro Industries

Just to push government agenda of providing financial assistance to Micro enterprises, Public Sector Banks are flagging off a mega credit campaign across the country from today. This campaign will be organized till October 2nd and will generate greater credit to MSME under Pradhan Mantri Mudra Yojana. It will also create a sound eco system subsequently for bank credit to aspiring entrepreneurs especially small and micro entrepreneurs under the Pradhan Mantri Mudra Yojana (PMMY). FM Arun Jaitley would also participate in one of such Mega Credit Campaigns and would hand-over the loan sanction letters to beneficiaries at a mega campaign being organised by the Punjab National Bank (PNB) tomorrow at Mundka, near Delhi. Micro entrepreneurs, very small traders, fruit sellers, and mechanics etc. would be actively participating in the said campaign. As per the information received by finance ministry, beside this Campaigns, public awareness is continuing to be generated through the print media, radio jingles and use of banners and posters so that prospective micro entrepreneurs are sensitised about the availability of finance through the formal banking system under PMMY.

Importantly MUDRA Ltd. has been established as a subsidiary of SIDBI, with an initial corpus of Rs. 5,000 crore to provide refinance to all banks seeking refinancing of small business loans under PMMY. During FY16 till date, 35.60 lakh borrowers have availed of credit under Mudra to the tune of Rs. 24,123 crore. Of these, 52% beneficiaries are women and about 50% new enterprises. All Public Sector Banks, Regional Rural Banks and Private sector banks have a target of Rs. 1, 22,000 crore during the current financial year for disbursement to small and micro enterprises up to Rs. 10 lakhs and such loans do not need to be supported by collateral security. As per an estimate there are about 5.77 crore small business units in the country in the informal sector which is targeted for benefit under the PMMY, apart from new aspiring micro entrepreneurs.

 PMMY loans fall into three categories, Shishu (upto Rs. 50,000), Kishore (between Rs. 50,000 – Rs. 5 lakh) and Tarun (between Rs. 5 lakh to Rs. 10 lakh). The current focus of the Government is on the Shishu category of micro loans which encompass a range of small activities like shopkeepers, fruit sellers, vegetable vendors, mechanics, barbers etc.