What is a MUDRA Loan under the Pradhan Mantri MUDRA Yojana?

MUDRA (Micro Units Development & Refinance Agency) loans provide collateral-free credit to non-corporate small businesses and micro-enterprises. Three categories: Shishu (up to ₹50,000), Kishore (₹50,001–₹5 lakh), and Tarun (₹5–₹10 lakh). Banks, MFIs, and NBFCs disburse these government-backed loans with no processing fee.