Complete Guide to Union Bank Mudra Loan
Get Project Report For Mudra Loan By CA & Experts @ Just ₹2,500/-
Among various financial schemes and products across multiple banks. Union Bank of India Bank is also a provider of Mudra Loan under the famously known Pradhan Mantri Mudra Yojana (PMMY). The Yojana was introduced to bring credit facilities to self-employed individuals, professionals, and MSMEs via Bank facilities and other financial operations. The yojana mainly was introduced to extend a helping hand to businesses. The growth of entrepreneurial journeys in India was also a main factor highlighted.
The Mudra Loan allows a maximum loan of up to Rs.10 Lakhs with a repayment structure of up to 5 years. The interest rate offered by different Banks Under PMMY varies. It depends on the applicant’s profile, loan amount, and repayment timeline.
The loan interest of Union Bank of India is around 16% – 26% p.a. Depending on all the parameters of selection. Also, the loan can be applied online as well as offline.
Union Bank of India Bank offers different categories of Mudra Loan Scheme which apply to different applicants.
Shishu
The Shishu category is where the loan amount is up to ₹50,000. This category is specifically for small businesses, home-based businesses, street vendors, shop owners, and first-time entrepreneurs.
Interest Rate: 7.40 – 8.50% p.a. with repayment tenure of 5 years
For this loan application, no processing fee and collateral requirements are needed.
Kishor
For this category, the loan amount is from ₹50,000 to ₹5 lakh. The category targets small manufacturing units, service enterprises, established retail shops, Small-scale industries, professional service providers, and trading businesses
Interest Rate: 8.50% – 10.25% p.a.. with repayment tenure of up to 7 years
For loan applications, there are semi-customised repayment plans and digital banking support as well. The bank charges 0.50% of the loan amount as processing fees.
Tarun
The category deals with Loan amounts from ₹5 lakh to ₹10 lakhs. This is suitable for Medium-sized enterprises, manufacturing units, well-established service businesses, educational institutions, healthcare facilities, and IT service providers.
Interest Rate: 8.50% – 10.25% p.a.With repayment tenure up to 10 years
For a loan application, a detailed business plan is required and a bank statement of the last 2 years. The bank keeps 1% of the loan amount as a processing fee.
Get Project Report For Mudra Loan By CA & Experts @ Just ₹2,500/-
The MUDRA Loan Scheme has significant eligibility criteria which have to be followed by every applicant. The individuals who follow the rules strictly will be provided with the scheme’s benefits.
The eligibility criteria for MUDRA Loan in Union Bank are as follows:
The loan application requires a certain list of documents that are required:
Personal Documents
Business Documents
Get Project Report For Mudra Loan By CA & Experts @ Just ₹2,500/-
Here are the top benefits of the mudra loan scheme provided by Union Bank of India Bank:
Preparation checklist:
The Union Bank is the right choice for the Mudra loan scheme because of the following reasons:
Competitive Interest Rates and Charges: The bank offers low interest rates compared to other banks, starting from 7% p.a.
Superior Digital Infrastructure: The in-depth digital application process and loan management
Quick Processing & Disbursement: The Bank offers a Fast-track approval system (3-7 days) and minimal documentation requirements.
Get Project Report For Mudra Loan By CA & Experts @ Just ₹2,500/-
With the help of the Mudra loan Scheme, it has become accessible for all kinds of business owners to scale up their businesses at multidimensional levels. So, if you are looking to apply for a loan you can choose Union Bank of India for Mudra loans as an ideal option.
For first-time borrowers with no credit history, yes, you can still apply, especially for the Shishu category.
The typical timeline is: 7-12 working days on average dependent on Factors like Complete documentation, Quick response to bank queries, Digital application, Existing relationship with the bank, and Clean credit history.
The Immediate Effects are SMS/Email alerts from the bank, a Phone call from the recovery team, an Impact on credit score, and late payment fees of 2-4% of the EMI amount in many cases.
There are early repayment Options such as full prepayment allowed after 6 months, partial prepayment allowed quarterly, and no prepayment charges for the Shishu category.