Pradhan Mantri Mudra Yojana (PMMY) helps small businesses, entrepreneurs, and self-employed individuals get easy access to credit without collateral. While the scheme is government-backed, the interest rates are decided by individual banks/NBFCs within RBI guidelines.
This guide explains how Mudra loan interest rates work, current examples (2025), factors affecting rates, and how to get the lowest possible rate.
Table of Contents
Nationalize Bank’s Mudra Loan Interest Rates
State Bank of India (SBI)
Current Starting Rate: ~7.50% p.a. (Shishu category)
Rate Structure: Based on External Benchmark Linked Rate (EBLR) plus bank spread
More Info: SBI Mudra Loan Official Page
Bank of Maharashtra
Rate Structure:
Up to ₹10 lakh: RLLR + 2.25%
₹10 lakh – ₹20 lakh: RLLR + 2.00%
Current RLLR: ~9.05%
Bank-Specific Spread (BSS): ~0.50%
More Info: Bank of Maharashtra PMMY Page
Punjab National Bank (PNB)
Rate Range:
Shishu: 7.80% – 8.50%
Kishor: 8.50% – 9.75%
Tarun: 9.75% – 10.25%
More Info: PNB Mudra Loan Page
Canara Bank
Rate Range:
Shishu: 8.05% – 9.10%
Kishor: 9.10% – 9.95%
Tarun: 9.95% – 10.50%
More Info: Canara Bank PMMY Page
Mudra Loan Categories
based on business maturity and funding needs:
Shishu
Loan limit: up to ₹50,000
Purpose: Seed capital for startups or micro units
Kishor
Loan limit: ₹50,001 – ₹5,00,000
Purpose: Growth and expansion of operational scale
Tarun
Loan limit: ₹5,00,001 – ₹10,00,000
Tarun-Plus (recent addition)
Loan limit: ₹10,00,001 – ₹20,00,000
Eligibility: Must be a repeat borrower who successfully repaid a Tarun loan previously
Features across categories:
Flexibility in tenure: up to 5 years for Shishu/Kishor; up to 7 years for Tarun/Tarun-Plus
Collateral not required for loans up to ₹10 lakh
Covered under credit guarantee schemes (CGFMU/CGTMSE), easing lender risk
Mudra Loan Providing Bank & NBFC Names
Mudra loans are available from a wide network of financial institutions, both public and private. Some of the prominent lenders include:
Public Sector Banks (PSBs): SBI, Bank of Baroda, PNB, Canara Bank, Bank of Maharashtra, Central Bank of India, Indian Overseas Bank, UCO Bank, Union Bank of India, Bank of India, and more.
Private Banks & NBFCs: HDFC Bank, ICICI Bank, Axis Bank, Bajaj Finserv, Lendingkart, Saraswat Bank, PSB Loans in 59 Minutes, etc.
Choose Your Favriot Bank for Mudra Loan
Mudra loans are segmented into four stages based on business maturity and funding needs:
These are the data for some banks’ Mudra loan interest rates, which you can use to plan your Mudra loan. You can also determine which bank to borrow from based on these numbers.
Because this program is directly launched by the Prime Minister, you can obtain this form of loan from numerous nationalized, government banks, private banks, and non-banking financial companies (NBFC).
.
Mudra Loan Interest Rate Table 2025
| Bank Name | Mudra Loan Interest Rate |
| State Bank of India | 12.15% |
| Punjab National Bank | 12.35% |
| Bank of Baroda | 8.15% to 12% |
| Canara Bank | 8.80% to 12% |
| Punjab & Sindh Bank | 9.20% to 12% |
| Union Bank of India | 8.60% to 12.90% |
| HDFC Bank | 8.45% to 12% |
Latest Example Rates (2025)
To understand current (mid-2025) pricing, here are live examples:
SBI: Effective 3.25% over EBLR, resulting in ~12.15% p.a. effective interest (effective from 15 Feb 2025) .
Bank of Maharashtra: RLLR (9.05%) + 2.25% spread + 0.50% BSS = ~11.80% p.a. for loans up to ₹10 lakh; slightly lower for higher tickets .
Mint / Market Insight: Mudra loans in 2025 are available up to ₹10 lakhs, with rates starting at ~9.30% p.a., depending on business risk and bank policies .
These bracketed examples show that Mudra rates today hover between 9% and 12%, depending on bank, ticket size, and borrower’s profile.
How to Get the Lowest Possible Rate
Maintain a good CIBIL score (750+ recommended).
Compare offers from multiple lenders.
Provide a clear business plan and supporting documents.
Apply under the appropriate category to avoid higher spreads.
Choose a bank where you already have an account for better terms.
How Interest Rates Are Decided
Interest rates for Mudra loans vary due to:
Lender’s Benchmark Rate (RLLR, MCLR, or EBLR)
Spread or Bank-Specific Spread (BSS)
Borrower Profile (credit history, repayment record)
Loan Amount & Category
Nature of Business
Mudra Loan Interest Rate Linked to RBI Repo Rate
Final Interest Rate = Benchmark Rate (RLLR/MCLR/EBLR) + Bank Spread + Risk Premium (if any)
Since RLLR, MCLR, and EBLR change with RBI repo rate updates, it’s best to always check the official bank links above for the latest figures before applying.
Why You Need Mudra Loan
If you are a new customer and are planning to start a small business or expand an existing one, you can apply for a Mudra loan of up to 10 lakhs. Aside from that, loans of up to Rs.50000 can be obtained online through emudra loans, for which no documentation is required.
eMudra loans are available from practically all nationalized banks, including SBI eMudra loans, PNB eMudra loans, Canara bank eMudra loans, and BOB eMudra loans. All of these banks offer eMudra loans to their current customers on favorable terms. Some specifics details are provided below.
BOB Mudra Loan Details
Bank of Baroda Provides digital E Mudra Loan in the below Categories
Digital Mudra Loan (Paperless Process up to 500000)
Digital MSME Working Loan up to 10 lakhs
Requirement for Digital Mudra Loan
If you are an existing BOB Customer you should have a current or saving account with the bank and your mobile number should be linked with your account.
If you are not an existing BOB customer, you have to provide 12 months bank statement for any bank account and your mobile number should be linked with your Aadhar card.
Pan Card
Udyam Registration Certificate at the name of your business.
For loans above 50000 to 2 Lakhs
Quotation for Equipment of machinery + Estimate for construction of shed etc.
For loans above 2 lakhs
GST Return filing login details or else GST returns for 12 months
ITR filing complete acknowledgment
Union Bank Mudra loans
Pradhan Mantri Mudra Yojana for Existing Customers for Union bank or non Account Holder
Instant E Mudra loan up to 50000 for Existing Customers of Union Bank of India
Sishu loan up to 50000
Kishore loan up 50000 to 5 lakhs
Tarun loan 5 lakhs to 10 lakhs
You can take loans of these three categories from this bank. The loan interest rate table is given above, which can be slightly higher or lower.
Documents Required
pan card
Aadhar card
Loan Above 50000
Udyam Aadhaar Number
GST number
Loan Tenure
1 Year to 7 Years
Loan Margin
Sishu Loan Margin – 5%
Kishore Loan Margin – 10%
Tarun Loan margin – 25%
No processing fee and no collateral security required.
State Bank of India Mudra Loan Details
State Bank also distributes Mudra loans in three categories. which are like
Shishu Loan – 50000
Kishor Loan – 50000 to 5 lakh
Tarun Loan – 5 Lakh to 10 Lakh.
The interest rate table for all three loans offered by SBI is given above. These interest rates keep going up and down.
You can take a loan up to 50000 online. For this you have to use SBI yono app.
The customer should be associated with the bank for at least 6 months to avail of the online loan.
Processing fee
No processing fee for Sishu and Kishore Loan.
0.5% processing fee for Tarun loan.
Loan Tenure – up to 60 months.
Moratorium Period – 6 Months
Margin 50k to 5 Lakhs – Nil
Above 5 to 10 Lakh 10%
Helpful Resources
Conclusion
Mudra Loan interest rates change over time depending on RBI policy, lender benchmarks, and borrower profile. Below is a reference of how some major banks currently structure their rates (as of August 2025), along with links to official pages for the most up-to-date details.