Fact Check: Is Govt offering Rs 1 lakh loan on payment of Rs 1,750 under PM MUDRA Yojana?

A rumour is prevailing all over social media, claiming that the Ministry of Finance has issued an approval letter, charging Rs 1,750 as a loan agreement fee to grant a loan up to Rs 1 lakh under the Pradhan Mantri MUDRA Yojana.

PIB debunks fake news of loan under PM MUDRA Yojana.

The Press Information Bureau (PIB) took to Twitter on Wednesday to debunk the viral letter on social media that claimed a loan of Rs 1,00,000 under the PM Mudra Yojana, granted upon payment of Rs 1,750 as loan agreement charges. The fact-checking department has said the letter is fake, and the Finance Ministry of India has not issued it.

An approval letter claims to grant a loan of ₹1,00,000 under the 𝐏𝐌 𝐌𝐮𝐝𝐫𝐚 𝐘𝐨𝐣𝐚𝐧𝐚 on payment of ₹1,750 as loan agreement charges#PIBFactCheck

◾️This letter is #Fake

◾️@FinMinIndia has not issued this letter

Read more: 🔗https://t.co/cQ5DW69qkT pic.twitter.com/5h6Lf25xHT

— PIB Fact Check (@PIBFactCheck) April 19, 2023

What is Pradhan Mantri MUDRA Yojana?

Pradhan Mantri MUDRA Yojana (PMMY) is a scheme launched by Prime Minister Narendra Modi on April 8, 2015, which provides loans up to Rs 10 lakh to non-corporate, non-farm small and micro enterprises. Commercial banks, RRBs, small finance banks, cooperative banks, MFIs, and NBFCs facilitate these loans. Late Union Finance Minister Arun Jaitley announced the scheme while presenting the Union Budget for Fiscal Year 2016. 

Any Indian Citizen who has a business plan for a non-farm income-generating activity such as manufacturing, processing, trading or service sector whose credit need is up to Rs 10 lakh can approach either a Bank, MFI or NBFC for availing of MUDRA loans under PMMY. The usual terms and conditions of the lending agency may have to be followed for availing of loans under PMMY. The lending rates are as per the RBI guidelines issued in this regard from time to time.