To give financial confidence to the budding entrepreneur, especially those in the socially excluded category, the government has proposed creation of a special bank – MUDRA – to fund small enterprises.
MUDRA, or the Micro Units Development Refinance Agency Bank, will have a corpus of Rs 20,000 crore and credit guarantee corpus of Rs 3,000 crore.
“MUDRA Bank will refinance Micro-Finance Institutions through a Pradhan Mantri Mudra Yojana,” the finance minister said in his budget speech.
Finance Minister said that priority in lending will be given to enterprises run by people belonging to the scheduled castes and scheduled tribes.
The government estimates that there are 3.57 crore small units that are run by people belonging to the socially disadvantaged classes (including other backward class) out of a total of 5.77 crore small business units in the country.