New Delhi, Mar 26 (KNN) The Government of India has implemented a series of targeted credit initiatives designed to support small traders, farmers, and emerging entrepreneurs across various sectors.
These strategic financial programs aim to provide accessible, affordable credit and foster economic growth at the grassroots level.
The Pradhan Mantri Mudra Yojana (PMMY) stands as a cornerstone of these efforts, offering collateral-free institutional credit through multiple lending institutions, including Scheduled Commercial Banks, Regional Rural Banks, Non-Banking Financial Companies, and Microfinance Institutions.
The scheme provides flexible loan products categorised into four tiers: Shishu (up to Rs. 50,000), Kishore (Rs. 50,000 to Rs. 5 lakh), Tarun (Rs. 5 lakh to Rs. 10 lakh), and Tarun Plus (up to Rs. 20 lakh for successful previous borrowers), catering to diverse entrepreneurial needs across manufacturing, trading, and service sectors.
Complementing the Mudra Yojana, the Stand Up India (SUPI) scheme focuses on targeted financial support for marginalised communities.
The program mandates scheduled commercial banks to provide loans ranging from Rs. 10 lakh to Rs. 1 crore to at least one Scheduled Caste or Scheduled Tribe borrower and one woman borrower per bank branch.
This initiative aims to facilitate greenfield enterprise development in manufacturing, services, and trading sectors.
The Union Budget 2025-26 has further expanded these efforts by announcing a new scheme targeting 5 lakh women, Scheduled Castes, and Scheduled Tribes first-time entrepreneurs.
This initiative will provide term loans up to Rs. 2 crore over the next five years, incorporating lessons from the successful Stand Up India Scheme and offering online capacity-building programs for entrepreneurship and managerial skills.
For the agricultural sector, the Kisan Credit Card (KCC) scheme provides comprehensive financial support to farmers.
Introduced in 1998, the program offers timely and affordable credit for agricultural inputs, crop production, and allied activities. In 2019, the scheme was expanded to cover working capital requirements for animal husbandry, dairy, and fisheries.
The government has implemented additional financial incentives through the Modified Interest Subvention Scheme.
This program provides an interest subvention of 1.5 percent to banks, effectively reducing the interest rate to 4 percent for farmers taking short-term working capital loans.
The recent Union Budget has further enhanced the loan limit from Rs. 3 lakh to Rs. 5 lakh for loans processed through the Kisan Credit Card.
Technological innovation has been instrumental in streamlining these credit initiatives.
The Jan Samarth portal serves as a digital platform connecting fifteen government-sponsored loan and subsidy schemes, enabling efficient digital loan applications and approvals.
Many banks and financial institutions have also developed online platforms and mobile applications to facilitate end-to-end digital loan processing, significantly reducing bureaucratic hurdles.
As announced by Minister of State in the Ministry of Finance, Shri Pankaj Chaudhary, these schemes represent a comprehensive approach to financial inclusion, providing critical support to entrepreneurs and farmers across India’s diverse economic landscape.
(KNN Bureau)
