Summary:
As the Pradhan Mantri Mudra Yojana completes 10 years on April 8, 2025, the programme stands as a transformative pillar in India’s journey toward financial inclusion and grassroots entrepreneurship. Launched under the Micro Units Development and Refinance Agency, this flagship initiative of the Prime Minister was created with a singular vision to fund the unfunded micro and small businesses across the country. By removing the barrier of collateral and easing access to credit, MUDRA set the stage for a new generation of local entrepreneurs to thrive. The scheme has enabled institutional loans of up to ₹20 lakh (US$ 23,288), making credit accessible for first-time business owners, especially in rural and semi-urban areas. Since its inception, more than 52 crore loans worth ₹32,61,000 crore (US$ 379 billion) have been sanctioned. Tamil Nadu, Uttar Pradesh and Karnataka have emerged as the top-performing states in terms of disbursements. The average loan size has seen notable growth rising from ₹38,000 (US$ 442.48) in FY16 to ₹1.02 lakh (US$ 1,187.86) in FY25, a sign of rising confidence and expanding business scale.
Women entrepreneurs have been at the heart of this transformation with 68% of all PMMY beneficiaries being women. The average disbursement per woman has grown at a CAGR of 13% from FY16 to FY25. Equally significant is the rise in financial inclusion among historically marginalised groups with 50% of Mudra accounts held by SC, ST and OBC entrepreneurs while 11% are owned by minorities. The share of Kishor loans ranging from ₹50,000 (US$ 582.28) to ₹5 lakh (US$ 5,822.82) has jumped from 5.9% in FY16 to 44.7% in FY25, indicating a shift from ultra-micro ventures to more stable small-scale businesses. According to State Bank of India data, total lending to Micro, Small and Medium Enterprises increased from ₹8,51,000 crore (US$ 99 billion) in FY14 to ₹27,25,000 crore (US$ 317 billion) in FY24 and is projected to cross ₹30,00,000 crore (US$ 349 billion) in FY25. This steady rise reflects the programme’s impact on building a self-reliant economy. Recognised globally by the International Monetary Fund, the scheme continues to be a powerful driver of inclusive growth and employment generation at the grassroots level.
Source: IBEF
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