PM Modi's Mudra scheme fails to attract women seeking loans for small biz

Despite a discount on the interest rates women pay, loans sanctioned to them under the Pradhan Mantri Mudra (micro units development and refinance agency) Yojana to encourage “micro” businesses fell by 5.8 percentage points in 2016-17 since the scheme’s launch in 2015-16, according to government data. Three in four loans sanctioned over these three years were to women.

The government gives a discount of 25 basis points on the interest charged on loans to women under the Women Enterprise Programme.  A “micro” unit is one that has invested less than Rs 2.5 million in plant and machinery or Rs  1 million in equipment, according to a government definition.

Since 2015-16, 75.5 million loans had been sanctioned to women as of December 22, 2017, finance minister Arun Jaitley told in the Lok Sabha on January 5. As of January 26,106 million loans had been sanctioned under the scheme,  stated Mudra portal on February 5.


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