In today’s entrepreneurial era, India’s government-backed Mudra Loan scheme is empowering millions of small and micro-businesses. The most sought-after aspect of this loan is its attractive Mudra loan interest rate, making it a preferred choice for budding entrepreneurs. Whether you’re starting a tailoring unit, a retail shop, or a small manufacturing business, understanding the interest rates is crucial for effective financial planning.
This comprehensive guide will help you navigate through the current Mudra loan interest rates, what factors influence them, and how much you will repay monthly across different loan brackets — from ₹1 lakh to ₹10 lakh. We’ll also cover special interest rates for women and provide insights into top banks like SBI, HDFC, and Indian Bank.
What is Mudra Loan?
MUDRA stands for Micro Units Development and Refinance Agency. Launched under the Pradhan Mantri MUDRA Yojana (PMMY), it aims to offer affordable credit to non-corporate, non-farm small/micro enterprises.
- Shishu – Loans up to ₹50,000
- Kishor – Loans from ₹50,001 to ₹5,00,000
- Tarun – Loans from ₹5,00,001 to ₹10,00,000
The Mudra loan interest rate varies depending on the bank, borrower profile, loan category, and tenure.
SBI Mudra Loan Interest Rate
| Loan Category | Interest Rate (Approx.) | Processing Fee |
|---|---|---|
| Shishu | 8.50% – 9.50% | Nil |
| Kishor | 9.35% – 10.15% | Nil – 0.50% |
| Tarun | 9.75% – 11.00% | Up to 0.50% |
Current Mudra Loan Interest Rates in 2025
Interest rates for Mudra Loans vary based on the lending institution and the applicant’s profile. Here’s a snapshot of current rates:Bankbazaar
| Bank | Interest Rate (p.a.) | Loan Tenure |
|---|---|---|
| State Bank of India (SBI) | 8.40% onwards | Up to 5 years |
| HDFC Bank | As per bank guidelines | Up to 7 years |
| Indian Bank | 10.65% onwards | Up to 5 years |
| UCO Bank | 9.60% onwards | Up to 7 years |
| Union Bank of India | EBLR + 1.25% | 1-3 years |
| Bank of Maharashtra | 9.05% onwards | Up to 7 years |
Interest Rates Based on Loan Amount
Understanding how interest rates correlate with loan amounts can help in better financial planning:
-
₹1 Lakh Loan: Interest rates typically start from 8.40% p.a., depending on the bank and applicant’s creditworthiness.
-
2-3 Lakhs Loan: Rates range between 9% to 11% p.a., with tenure options up to 5 years.
-
₹5 Lakhs Loan: Interest rates vary from 9.5% to 12% p.a., subject to bank policies.
-
₹10 Lakhs Loan: Rates can go up to 12.15% p.a., especially for Tarun category loans.
Mudra Loan Interest Rate for ₹1 Lakh
The Mudra loan interest rate for ₹1 lakh typically ranges from 8.50% to 9.75% per annum. Monthly EMI at 9.5% for 2 years: ₹4,606 approx.
Mudra Loan Interest Rate Calculator
Use a Mudra Loan interest rate calculator from:
Mudra Loan Interest Rate per Month
If the annual interest rate is 9%, monthly interest rate = 0.75% per month.
Mudra Loan Interest Rate for ₹2 Lakh
Rates range from 9.25% to 10.50%. EMI for ₹2 lakh at 10% for 3 years ≈ ₹6,450/month.
Mudra Loan Interest Rate for ₹3 Lakh
Rate: 9.5% to 11.0%. EMI at 10.5% = ₹9,710/month for 3 years.
Mudra Loan Interest Rate for ₹5 Lakh
Rate: 9.75% – 11.5%. EMI at 10.75% for 4 years: ₹12,850/month.
Mudra Loan Interest Rate for ₹10 Lakhs
Rate: 10.25% to 12.5%. EMI at 11.25% for 5 years: ₹21,900/month.
Mudra Loan Interest Rate for Ladies
Many banks offer concessions of 0.25% to 0.50%. Indian Bank starts at 8.75% for women-led businesses.
Mudra Loan Interest Rate – Indian Bank
- Shishu: from 8.85%
- Kishor: 9.35% – 10.25%
- Tarun: up to 11.75%
More at Indian Bank PMMY Info
How to Apply for PM Modi Mudra Loan
- Visit your bank branch (SBI, HDFC, etc.)
- Fill the Mudra loan application
- Submit documents: ID, address proof, business plan
- Loan processed and disbursed on approval
Online application at udyamimitra.in
FAQs
1. What is the interest rate of HDFC Mudra loan?
HDFC offers Mudra loans at 9.99% to 12.5% depending on the borrower’s profile.
2. What is Mudra loan limit?
The loan ranges from ₹50,000 to ₹10 lakh based on business need.
3. Is Mudra Loan interest free?
No. It offers low interest but is not interest-free.
4. How to apply for PM Modi Mudra Loan?
Apply via any bank or online at udyamimitra.in with documents.
5. Who will be eligible for Mudra Loan?
Eligibility includes small business owners, vendors, artisans, startups with a viable plan.
Conclusion
Understanding the Mudra loan interest rate is key to planning your business funding. With flexible rates, collateral-free options, and special provisions for women, the scheme is a valuable resource. Always apply via official channels for safety and transparency.