How to Apply for a Mudra Loan at Canara Bank?

The Pradhan Mantri Mudra Yojana (PMMY) is specially meant for small entrepreneurs. MUDRA loans (Micro-Units Development and Refinance Agency) are given under this PMMY scheme to Indian citizens between the age group of 25 years to 58 years. Pradhan Mantri Mudra Yojana (PMMY) is a very popular and useful programme of the government of India. Banks support microenterprises that generate income but are not corporations or farmers and need credit of less than Rs. 10 lakhs through MUDRA loans. Loan payback terms for MUDRAs vary from one year to seven years, with interest rates beginning at 7.30% p.a.

Objectives of the Mudra Loan.

Mudra loans are offered to those who wish to start their small business or grow their small enterprises under the PMMY scheme. This section of society is mainly from low-income groups, those with economically weaker backgrounds, or those who are physically challenged. The scheme was started to create more jobs and uplift the weaker section. The objective of providing a Mudra loan is as follows:

• Encouraging small businesses: The main objective of the Mudra loan scheme is to motivate entrepreneurship, especially for those who are physically and economically from weaker sections and have disadvantages of poor backgrounds.
• Job Creation: Mudra Loans boost small enterprises, which leads to the creation of jobs and a decrease in unemployment rates.

• Economic Growth: Boosting the creation and expansion of small businesses impacts the country’s economy.

Mudra Loan at Canara Bank:

The Micro Units Development and Refinance Agency (MUDRA), a non-banking financial company (NBFC), is to support the micro-enterprise sector. Canara Bank is one of the well-known lenders that provides loans to small and medium-sized businesses. it is always ready with extended hands to help the weaker section by providing MUDRA loans through the Government of India programme. Mudra loan of Rs. 50,000 to Rs.10 lakhs is made available to small-scale businesses through the Mudra loan scheme.

Borrowers can apply for business loans through this scheme, with the maximum amount being Rs. 10 lakhs. The loans are based on the Shishu, Kishor, and Tarun categories. There are no processing charges in the Shishu and Kishor categories. Only a 0.5% processing fee is charged in the Tarun category. Only loans in the Shishu category can be applied online; you must visit the bank or contact customer care service for the other two categories.

The Shishu category is for microbusinesses. A loan of up to Rs. 50,000 is sanctioned in this category. Kishor category loan is for businesses that need the loan from Rs. 50,000 to Rs. 5 lakhs. Tarun Loan ranges between Rs. 5 lakhs and Rs. 10 lakhs, available for more established and strong firms.

The Mudra Card from Canara Bank: Canara Bank provides a card that looks like a debit card. It is known as a Mudra card Mudra loan. With the MUDRA Card, you may economically manage your working capital limit while minimising your interest payments through numerous withdrawals and credits. It is possible to use a MUDRA Card to make payments at any “point of sale” machine and withdraw cash from any ATM or mini ATM in the nation.

The businesses covered under the Mudra Loan are:

The Canara Bank Mudra loan can be used to develop different types of businesses. The list of activities covered by the Mudra Loan is shown below:

• Vehicles are used for both passenger and cargo transportation.
• Food products sector.
• Activities related to communities, society, and individual service.
• Business loans for traders and store owners.
• Textile products industry and undertakings.
• Agriculture-related undertakings have micro units.
• Equipment Financing Programme

Eligibility criteria for Mudra loans at Canara Bank.

The eligibility requirements for Canara Bank Mudra loans are very common, the same as those for other banks. The following are the requirements for eligibility for Canara Bank Mudra Loans:

• This Mudra Loan Yojna is available to individuals, proprietorships, partnerships, and self-help groups.
• This lending option is unavailable to trusts, Hindu Undivided Families (HUF), or private limited corporations.
• Current customers who have demonstrated a solid track record over the last two years (both in terms of account management with the financing branch and the financial records of the business unit) are eligible for Mudra loans.
• New clients who have positive opinion letters issued by their current banks.
• New units who have positive assessments of their promoters about their market.
• According to the scoring standards, units with a risk rating of “high” and/or grading of higher or highest are not qualified to apply for this loan.
• It is not appropriate for the loan applicant to be a defaulter at other banks.
• To determine the borrower’s net worth in the absence of a third-party guarantee, the lender may request the borrower’s asset and liability statement, which includes the director and partner lists.

Required documents for Mudra loans from Canara Bank individually.

The following is the documentation for Canara Bank Mudra Loans:

• Aadhar card
• PAN card
• Customer identification documentation and the NF998 MSME application.
• Address proof of the business unit and the promoters.
• Quote proof of the item to be purchased for business purposes.
• Financial records for the previous two years with ITR and predictions for the upcoming year.
• Permissions and licenses
• Details of the guarantor, together with asset proof
• Technical and financial feasibility details are included in the project report.
• Sales made throughout the current fiscal year as of the application’s submission date.
• Bank statement of account.

Required documents for partnership firm in Canara Bank Mudra Loan.

• Completed and signed loan application form
• Partnership Deed and Partnership Registration Certificate
• Identification Document for the Firm
• Valid rent agreement,
• Post-paid phone bill, electricity bill, or firm PAN card or PAN issuing letter
• Office address proof
• Income Proof
• CMA Data and Project Report
• Debtors and Creditors Certificate
• GST Return
• Last Three Years’ Income Tax Returns of the Applicant and Co-Applicant
• Audited or CA-certified computation of income, trading account, profit and loss account, and balance sheet
• Annual Audit Report
• Tax Audit Report, if Audited
• Form 16A, if applicable;
• Net Worth of Applicant, Co-Applicant, and Guarantors Banking Evidence includes:

1. Company’s major account statement from the previous year,
2. The current account,
3. The cash credit account,
4. The overdraft account,
5. The loan statement for running loans,
6. The most recent closed loan NOC,
7. The bank statement from the last six months.

• Declaration of Savings Account for Applicant and Co-Applicant
• As it relates to security,
• Plant and Machinery List,
• Plant and Machinery Current Valuation Report,
• Margin Money,
• Previous and current sales deeds
• Property Photographs and Previous Property Search and Valuation Report
• Other documents that are needed: corporate brochure, business references, business experience supporting documents, promoter/guarantor profile, partnership business profile Blue-ink self-attestation is required for all A4 copies of the aforementioned papers.

Procedure to Apply for Mudra Loan from Canara Bank.

You can apply online for the Mudra loan at Canara Bank only if you are applying for the Shishu category, which means you are applying for a loan under ₹50 thousand. But if you want to apply for more than ₹50,000, then you should go to your nearest branch of Canara Bank.

If you are looking for an online application, the process is as follows:

• Go to the Canara Bank website.
• Then, visit the loan area and select the Mudra loan link.
• Verify the requirements for Pradhan Mantri Mudra Yojana, provided by Canara Bank,
• Then, fill out an easy-to-use online application to apply for a Mudra loan at Canara Bank.
• You will hear from one of the relationship managers at Canara Bank shortly to discuss the next steps in the process.
• You can give +919878981166 a call for additional details and free advice.
• The loan agent and contact information for the Canara Bank Mudra loan are available there.
• Applying online or over the phone at +919878981166 are two options.

Also Read: How to Transfer a Canara Bank Account From One Branch to Another?

How to Generate Canara Bank ATM PIN Online?

How to Apply for Debit Card Online in Canara Bank?

Final words.

The programme enables income-generating microenterprises operating in the manufacturing, trading, or service sectors—including those involved in agriculture-related industries like dairy, beekeeping, or poultry—to get microcredit or loans up to Rs. 10 lakhs. The scheme offers financial support to non-corporate and non-farm sectors that are involved in the income-generating activities of micro and small businesses.

FAQs.