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Please Note: Union Bank of India is not a Paisabazaar partner. Offers would be from partner banks/NBFCs only.
| Union Bank MUDRA Loan Highlights | ||
| Particulars | Union Bank Shishu MUDRA Loan | Union Bank MUDRA – Kishore & Tarun STP |
| Loan Amount | Up to Rs 50,000 | Above Rs 50,000 to 10 lakhs (Up to Rs 20 lakhs proposed in Budget 2024) |
| Facility | Term Loan | Term Loan, Working Capital |
| Interest Rates | 10.55% p.a. | 11.05%-12.05% p.a. |
| Tenure | 3 years | Term Loan: |
| 5 years (for up to Rs 5 lakh) | ||
| 7 years (for above Rs 5 lakhs) | ||
| Working Capital – 1 year | ||
| Processing Fees | NIL | NIL |
Interest Rates are updated as of 20 November 2024
Interest Rates of Union Bank MUDRA Loan
Interest Rates of Union Bank Shishu MUDRA Loan
Union Bank of India offers Shishu MUDRA loan at an interest rate of 10.55% p.a. for a loan amount of up to Rs 50,000.
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Interest Rates of Union Bank MUDRA – Kishore & Tarun STP
| Loan Amount | Interest Rate (p.a.) |
| Above Rs 50,000 to Rs 2 lakhs | 11.05% |
| Above Rs 2 lakh to Rs 10 lakhs | 12.05% |
Features of Union Bank MUDRA Loan
Purpose
Shishu MUDRA Loan: Term loan facility for meeting working capital requirements
Kishore & Tarun STP: Term loan facility for purchase of capital assets and working capital loan facility for meeting working capital requirements of the enterprise.
Loan Amount
Union Mudra loans are divided into the following three categories signifying the growth and funding needs of the beneficiary micro-entrepreneur:
| Categorisation | Loan Amount |
| Shishu | Up to Rs 50,000 |
| Kishor | Above Rs 50,000 to Rs 5 lakh |
| Tarun | Above 5 lakhs to Rs 10 lakhs* |
*Budget 2024 has proposed to increase the Mudra loan limit to Rs 20 lakh for entrepreneurs who have repaid previous loans under the ‘Tarun’ category.
Repayment Tenure
Shishu MUDRA Loan Tenure: 3 years
Kishore & Tarun STP Loan Tenure:
| Particulars | Tenure |
| Working Capital | 1 year subject to renewal |
| Term Loan for loan amount up to Rs 5 lakh | Up to 5 years |
| Term Loan for loan amount above Rs 5 lakh | Up to 7 years |
Margin
Shishu MUDRA Loan: NIL
Kishore & Tarun STP:
In the case of Term Loan
| Loan Amount | Margin |
| Up to Rs 5 lakhs | 10% |
| Above Rs 5 lakhs | 25% |
In the case of Working Capital
| Loan Amount | Margin |
| Up to Rs 5 lakhs | 20% |
| Above Rs 5 lakhs | 25% |
Security
Shishu MUDRA Loan: Hypothecation of book debts, stocks and other assets purchased out of loan
Kishore & Tarun STP: In the case of working capital, hypothecation of stocks and book debts and in the case of term loans, hypothecation of assets bought out of the bank’s finances is required as a security.
Guarantor
Shishu MUDRA Loan: NIL
Kishore & Tarun STP: Personal guarantee of all partners and promoters of the firm or LLPs is required. There is no need for a third-party guarantor.
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Fees & Charges of Union Bank MUDRA Loan
For Union Bank Shishu Loan
| Particulars | Charges |
| Processing Fees | NIL |
| Digital Convenience Fee | Rs 1,000 |
| Stamp Charges | Rs 171 |
| Insurance Charges | NIL |
For Union Bank MUDRA – Kishore & Tarun STP
| Particulars | Charges |
| Processing & documentation Charges | NIL |
| Digital Convenience Fee | Rs 1,000 |
| Penal interest on delayed payments | 2% p.a. for the duration of the instalments delayed |
| Penal Interest on non-submission or delay in submission of stock statement | 1% p.a. |
| Prepayment Penalty | NIL |
Applicants should note that Union Bank provides a 3-day cooling-off or look-up period during which they will not be charged any penalty on loan prepayment.
Eligibility Criteria for Union Bank MUDRA Loan
Union Bank of India offers MUDRA loan to micro-enterprises having business in trading, manufacturing and service sector under the PM MUDRA Yojana. Professionals like CA/CS/ICWA/Medical professionals/Architect, etc. can also avail Union Bank MUDRA loan.
Eligibility for Union Bank Shishu Loan
- Applicant should be a micro-entrepreneur
- Applicant should have a Union Bank of India (UBI) savings account
- Applicant should have atleast 6 months banking relationship with UBI or with any other Bank
- The loan can be availed for income generating activities only
- Prospective borrower should be at the business place while availing for MUDRA loan
- Applicant should not be defaulter in any Bank or any financial institution.
Eligibility for Union Bank MUDRA – Kishore & Tarun STP
- The promoter’s age should be between 21 to 65 years
- The business entity should have a valid Udyam Registration Number (URN)
- Eligible borrowers – Individuals, Partnership concerns (including LLPs), Proprietorship classified under category of micro-enterprise as per MSMED Act 2006
- Business entity should have a minimum 6 month old bank account with any Schedule Commercial Bank
- Borrower, promoter, or sister concern name should not be in a defaulter list or CFR
Documents Required for availing Union Bank MUDRA Loan
For Union Bank Shishu MUDRA Loan
MUDRA loan applicants have to submit documents digitally on the NeSL platform through the Aadhaar-based OTP system. Business proof or establishment certificate, GST or Udyog Aadhaar are required to be uploaded.
Prospective borrower should take note of the following while availing for loan:
- Mobile number is registered with Union Bank and UIDAI.
- PAN, Aadhaar number and latest address are updated in the account
For Union Bank MUDRA – Kishore & Tarun STP
Eligible micro-entrepreneurs can visit Union Bank of India branch for submission of required documents. Alternatively, eligible individuals or proprietorship concerns can also submit MUDRA loan documents online through Aadhar OTP based system.
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FAQs
1. Is there any MUDRA loan for women?
The government have clarified that women of SC/ST and OBC category would be preferred while giving loans under this scheme.
Also Read: Top 5 Business Loan Schemes for Women Entrepreneurs
2. Do all banks give MUDRA loan?
Yes, all the banks such as all scheduled commercial banks in public and private sector; Regional Rural Banks (RRBs); all Micro Finance Institutions (MFI); Small Business Finance companies and NBFCs and scheduled urban and state co-operatives.
3. Are loans that are covered under MUDRA are collateral-free loans?
Yes, the loans covered under MUDRA are collateral-free loans. However, assets created out of the bank loan to be charged with the bank.
4. Are the loans subsidised by the central government?
No, these loans are not subsidised by the central or state governments.
5. Generally what is the processing time for loans under the MUDRA scheme?
Generally it takes 7- 10 days for processing of lower amount like Shishu loan while other categories have processing time varying from bank to bank.
6. How can I get PSB loan in 59 minutes from Union Bank?
Interested applicants looking to apply for PSB loans need to visit their official website ”psbloansin59minutes.com” and further select their desired lender (Union Bank) to proceed with loan formalities.
7. How can I get a Mudra loan application form?
To download Mudra loan application form you can click on the link below and scroll down to get the link of loan application form in Hindi and English.
https://www.unionbankofindia.co.in/english/mudra-loan.aspx
8. How can I check my Union Bank Mudra loan status?
Ans. For checking your Mudra loan application status, you can either call on the bank’s toll-free number (1800-22-2244) or can visit the nearest bank branch along with the loan details like reference number or loan application number.