Credit & Loans
Last Verified: 22 Aug 2026
PM Mudra Yojana (PMMY) 2026: Loan Limits, Tarun Plus (₹20L) & Application Guide
Everything you need to know about Pradhan Mantri Mudra Yojana in 2026, including the new Tarun Plus tier up to ₹20 Lakh, interest rates, document checklists, and application workflow.
Aditya Patil• MSME Policy Research Desk
Official Government PortalKey Regulatory & Practical Highlights
- •Four distinct loan tiers: Shishu (≤₹50,000), Kishor (₹50,001–₹5 Lakh), Tarun (₹5 Lakh–₹10 Lakh), and Tarun Plus (₹10 Lakh–₹20 Lakh).
- •Tarun Plus limit of ₹20 Lakh was officially notified by the Department of Financial Services (DFS) on 24 October 2024 for repeat borrowers with good repayment track record.
- •Zero collateral or third-party guarantee required across all Mudra loan categories.
- •Interest rates are determined by the lending institution (commercial banks, RRBs, SFBs, NBFCs, MFIs) and are not fixed by the government.
- •Apply online via JanSamarth portal (jansamarth.in) or directly at any scheduled commercial bank branch.
1. Overview of Pradhan Mantri Mudra Yojana (PMMY)
Pradhan Mantri Mudra Yojana (PMMY) was launched by the Government of India to provide formal institutional credit up to ₹20 Lakh to non-corporate, non-farm micro and small enterprises.
Loans under PMMY are extended by Member Lending Institutions (MLIs) — including Public Sector Banks, Private Commercial Banks, Regional Rural Banks (RRBs), Small Finance Banks (SFBs), Micro Finance Institutions (MFIs), and Non-Banking Financial Companies (NBFCs).
2. Four Mudra Loan Categories (Updated 2026)
| Loan Tier | Loan Amount Limit | Target Stage | Typical Repayment Tenure |
|---|---|---|---|
| : |
| : |
|---|
| : |
|---|
| : |
|---|
| Shishu | Up to ₹50,000 | New startups, micro vendors, retail artisans | Up to 36–60 months |
| Kishor | ₹50,001 to ₹5,00,000 | Developing units buying tools or raw materials | Up to 60 months |
| Tarun | ₹5,00,001 to ₹10,00,000 | Established micro units expanding capacity | Up to 60–84 months |
| Tarun Plus | ₹10,00,001 to ₹20,00,000 | Repeat borrowers who fully settled prior Tarun loans | Up to 84 months |
What is the new Tarun Plus category? Announced in Union Budget 2024-25 and officially notified by the Department of Financial Services (DFS) w.e.f. 24 October 2024, the **Tarun Plus** category doubles the maximum Mudra borrowing ceiling from ₹10 Lakh to **₹20 Lakh**. It is specifically available to entrepreneurs who have previously availed a Tarun loan and demonstrated a clean repayment history.
3. Interest Rates & Processing Fees
- **Interest Rate:** The Government of India does not fix a single mandatory interest rate. Interest rates are determined by individual lending banks based on their internal EBLR / MCLR benchmarks and the borrower's credit assessment (typically ranging between **9.25% and 13.5% p.a.** in scheduled commercial banks).
- **Processing Fee:** **NIL (0%)** for Shishu loans (up to ₹50,000). For Kishor, Tarun, and Tarun Plus loans, banks typically charge between 0.50% and 1.00% + GST.
- **Collateral Security:** As per RBI guidelines, **NO collateral or third-party guarantee** can be demanded by banks for loans sanctioned under PMMY.
4. Eligibility Criteria
- Any Indian citizen who has a viable business plan for a non-farm income-generating activity in manufacturing, trading, or service sectors.
- Minimum age: 18 years; Maximum age: 65 years at loan maturity.
- The applicant must not have defaulted on any previous loan with any bank or financial institution (clean CIBIL score ≥ 650 preferred).
- For Tarun Plus: Must produce loan closure and clean repayment certificate of earlier Tarun loan.
5. How to Apply Online (JanSamarth Portal)
- Visit the unified national credit portal: `https://www.jansamarth.in`.
- Under "Business Activity Loan", click on **"Check Eligibility"**.
- Select your enterprise type, required loan amount, and social category.
- If eligible, complete digital registration using Aadhaar and mobile OTP.
- Upload basic financial proofs (ITR, Bank Statements, Udyam Certificate).
- Select your preferred lending bank and submit your digital application for fast in-principle sanction.
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