How to Apply for a Mahindra Bank Mudra Loan : The Micro Units Development and Refinance Agency (MUDRA) is an Indian government initiative that provides funding to small businesses and startups. Mudra loans help entrepreneurs who may not have access to traditional bank lending to get the capital they need. These loans are available through banks, NBFCs, MFIs and other lending institutions.
Mahindra Bank Mudra Loan
|Loan amount||Maximum Rs 10 lakh|
|Loan interest rate||8.05%|
|Shishu Plan||Rs.50,000 upto|
|Kishore Scheme||Between Rs 50,000 to Rs 5 lakh|
|Tarun Yojana||Between Rs 5 lakh to Rs 10 lakh|
Mahindra Bank Mudra Loan One of the leading private banks that provides Mudra loans is Mahindra Bank. Mahindra Bank offers these loans on attractive terms tailored specifically for micro and small business owners across India.
In this comprehensive guide, we will look at all the key details regarding “Mahindra Bank’s Mudra loans – eligibility, documents needed, application process, loan amount, interest rates, repayment options and more”. Read on to find out everything about availing funding for your small business through Mahindra Bank’s Mudra loans!
Benefits of Mahindra Bank Mudra Loan
Some of the major benefits of getting a Mudra loan from Mahindra Bank are:
- Collateral-free funding – Loans up to Rs. 10 lakhs can be availed without mortgaging any asset. This makes access to credit much easier.
- Lower interest rates – Mahindra Bank offers attractive interest rates starting at just 10% per annum on these loans.
- Longer repayment tenure – You get the flexibility to repay comfortably over a tenure of 5 years.
- Quick approval – Mahindra Bank aims to disburse the loan within 7-10 working days.
- Minimal documentation – Hassle-free process with easier eligibility norms.
- Nil prepayment charges – You can foreclose the loan fully or partially without any penalty charges.
Loan Eligibility and Documents Required
Eligibility for Mahindra’s Mudra Loans
To qualify for a Mudra loan from Mahindra Bank, the applicant must satisfy the following eligibility criteria:
- Indian citizen above 18 years of age
- Business entity must be proprietorship, partnership, private limited, LLPs, Trusts etc.
- Business activity should be manufacturing, trading or services
- Annual business turnover less than Rs. 10 lakhs
- Must have a functioning current account
- Should have valid GSTIN number and ITR (if applicable)
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Both new and existing businesses can apply as long as they satisfy the above criteria. The business must be operational in India currently.
List of Documents Required
When applying for a Mudra loan from Mahindra Bank, keep these documents handy:
- Duly filled and signed Mudra loan application form
- Identity proof – Aadhaar, PAN, Voter ID, Passport etc.
- Current address proof
- Business address proof – electricity bill, GST certificate etc.
- Last 6 months’ bank account statements
- ITRs for last 2 years (if filed)
- Ownership proof – Lease or rent agreement, NOC etc.
- Quotations of machinery, inventory etc. to be financed
Keeping these documents ready will make the application process quicker.
Loan Amount, Interest Rates and Tenure
Loan Amount Offered
Mahindra Bank offers Mudra loans from Rs. 50,000 up to Rs. 10 lakhs. The maximum loan amount under the three categories is:
- Shishu – Loans up to Rs. 50,000
- Kishore – Loans above Rs. 50,000 to Rs. 5 lakhs
- Tarun – Loans above Rs. 5 lakhs to Rs. 10 lakhs
The loan amount will depend on your eligibility, business vintage, credit score and repayment capacity.
Interest Rates and Tenure
Mahindra Bank charges interest rates from 10% p.a. to 18% p.a. on Mudra loans. The rate applicable will depend on the loan amount, tenure, internal credit scoring, type of business activity etc.
The maximum repayment period is 5 years. You can choose a tenure from 6 months to 5 years based on your business cash flows. The EMI reduces with longer tenure.
How to Apply for Mudra Loan from Mahindra Bank
Online and Offline Application Process
Mahindra Bank offers two ways to apply for a Mudra loan:
- Visit Mahindra Bank’s website and click on ‘Apply Now’ button for Mudra loans.
- Select type of loan – Shishu, Kishore or Tarun
- Fill the online application form and upload required documents.
- Submit the application and track status online.
- Visit your nearest Mahindra Bank branch.
- Meet the branch manager and submit duly filled loan application with documents.
- The manager will assist you through the application process.
While online process takes less time, offline process gives you the advantage of personalized assistance.
Step-by-Step Application Process
Follow these steps to apply for Mahindra Bank’s Mudra loan:
- Gather all the required documents as per eligibility and KYC norms.
- Duly fill the Mudra loan application form online or offline.
- Pay the non-refundable application fee.
- Submit the form along with documents to Mahindra Bank online or at branch.
- Mahindra Bank will scrutinize the form and documents. They may contact you for additional details or documents if needed.
- The bank conducts due diligence, credit checks and verifies the documents submitted.
- If your application is approved, Mahindra Bank issues sanction letter specifying the loan amount and key terms & conditions.
- Accept sanction terms, complete documentation formalities and sign the agreement.
- The loan amount gets directly credited to your bank account within 7-10 working days.
Ensure timely submission of documents for quick processing and approval.
How the Loan Amount is Disbursed
Once your Mudra loan application is approved, Mahindra Bank will directly credit the loan amount to your bank account digitally. This is the fastest and most convenient way of getting the funds.
Some key points regarding disbursal:
- The loan amount can only be used for the business purpose mentioned in loan application.
- You need to provide purchase invoices for machinery, inventory etc. financed via loan.
- Mahindra Bank will conduct random checks on end-use of loan amount.
- The total timeline from approval to disbursal is approximately 7-10 working days.
Ensure you use the loan strictly for approved business activities only. This will avoid any issues later.
Repayment Options and Process
Flexible Repayment Modes
Mahindra Bank offers the flexibility to repay your Mudra Loan in either of two ways:
EMI mode – Repay in equated monthly instalments over the loan tenure you have selected. The EMI amount will remain fixed.
Lump sum payments – Option to repay part or full loan outstanding through lump sum payments at any time during loan tenure, without any penalty charges.
You can choose the repayment mode as per your business cash flows for ease of repayment.
Prepayment and Foreclosure of Loan
Mahindra Bank allows you the flexibility to:
- Prepay part of your outstanding loan anytime during the tenure without any charges.
- Foreclose or settle the loan fully by paying the entire principal outstanding and interest.
Part or full prepayment and foreclosure help reduce your interest outgo and overall repayment burden. This provides flexibility to repay ahead of schedule.
For entrepreneurs looking for easy business financing options, Mahindra Bank’s Mudra loans are an excellent choice. With minimal documentation, quick approval and disbursal, attractive interest rates and flexible repayment, these loans make it easy to get funding for your small business needs.
Mahindra Bank has tailored the typically stringent bank lending approach to suit small business owners through Mudra loans. So if you need capital to start, stabilize or grow your micro or small enterprise, you must consider applying for a Mahindra Bank Mudra Loan. It provides easy access to funding that can take your entrepreneurial journey to the next level!
FAQs on Mahindra Mudra Loans
How much time does it take to get Mudra loan approved from Mahindra Bank?
Mahindra Bank aims to provide in-principle approval within 1 working day and complete loan disbursal within 7-10 working days.
What is the maximum loan amount I can get under Mahindra Bank’s Mudra loans?
You can avail a loan of up to Rs. 10 lakhs under Mahindra Bank’s Mudra loan scheme.
What documents do I need for getting Mahindra’s Mudra loans?
Basic KYC documents, business address proof, bank statements, ITRs and quotation for loan are needed. No income proof or collateral required for loans below Rs. 10 lakhs.
Is there any prepayment or foreclosure charges on Mahindra’s Mudra loans?
No. Mahindra Bank does not levy any prepayment or foreclosure charges if you repay your Mudra loan ahead of tenure.