SSC
What is the full form of MUDRA, as in MUDRA Yojana?
Answer (Detailed Solution Below)View answer ▾Hide ▴
Answer: Option B — Micro Units Development and Refinance Agency
Detailed Solution
MUDRA stands for "Micro Units Development and Refinance Agency Limited".
About MUDRA:
- It was set up in 2015 as a wholly owned subsidiary of the Small Industries Development Bank of India (SIDBI).
- Its purpose is to "fund the unfunded": to provide refinance support to banks, non-banking financial companies (NBFCs) and microfinance institutions (MFIs) that lend to micro and small enterprises in the non-farm sector.
Pradhan Mantri MUDRA Yojana (PMMY):
- It was launched on 8 April 2015 by Prime Minister Narendra Modi.
- It provides collateral-free loans to non-corporate, non-farm small and micro enterprises, such as shopkeepers, small manufacturers, traders, artisans, food processors, vendors and service providers.
Loans are given by commercial banks, regional rural banks, small finance banks, cooperative banks, MFIs and NBFCs. MUDRA itself does not lend directly to borrowers.
Categories of MUDRA loans:
- Shishu: loans up to 50,000 rupees.
- Kishore: loans above 50,000 rupees and up to 5 lakh rupees.
- Tarun: loans above 5 lakh rupees and up to 10 lakh rupees.
- Tarun Plus: a new category for loans above 10 lakh and up to 20 lakh rupees, for borrowers who have successfully repaid earlier Tarun loans (announced in the Union Budget 2024-25).
Achievements:
- In ten years (2015-2025), more than 52 crore loans worth over 33 lakh crore rupees were sanctioned.
- About 68 per cent of the loan accounts belong to women entrepreneurs, and about half to SC, ST and OBC borrowers.
- The "MUDRA card" is a debit card (RuPay) that allows borrowers to withdraw working capital as needed.
Related schemes:
- Stand-Up India (2016): loans of 10 lakh to 1 crore rupees for SC, ST and women entrepreneurs.
- PM SVANidhi (2020): micro-credit for street vendors.
- Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).
- "Credit Guarantee Fund for Micro Units" (CGFMU), 2015, guarantees MUDRA loans.
Why not the other options?
- ✗"Micro and Urban Development Refinance Authority" is not the correct expansion.
- ✗"Medium Units Development and Rural Assistance" is not the correct expansion.
- ✗"Micro Units Deposit and Repayment Agency" is not the correct expansion.
Quick tip
Remember: MUDRA = Micro Units Development and Refinance Agency (2015; subsidiary of SIDBI; PMMY launched 8 April 2015); loans = Shishu (up to 50,000), Kishore (up to 5 lakh), Tarun (up to 10 lakh), Tarun Plus (up to 20 lakh).
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This question tests your understanding of Government Schemes, a key topic in the General Knowledge section. The detailed solution above uses a step-by-step approach to show the reasoning, and where available, a shortcut that helps you solve similar questions in under 90 seconds during the actual exam.
This topic covers the major welfare and development schemes of the Government of India, such as those for financial inclusion, health, housing, agriculture, skill development and women and child welfare, along with their launch year, objectives and ministries. Questions usually ask what a scheme aims to do, when it was launched, or which ministry runs it. For example, Pradhan Mantri Jan Dhan Yojana (2014) aims at financial inclusion through bank accounts. Schemes are often renamed, merged or extended, so pair these static facts with the latest updates before banking and government exams. Practise the government schemes questions below, written in the style of the general awareness sections of exams such as SSC, banking, railways, CUET GAT, MAH CET and CLAT. Each question comes with a detailed explanation that adds related facts, so every question helps you revise more than one point.