Empowering India's Micro-Entrepreneurs: An Analytical Overview of the Highlights of the MUDRA Scheme

Abstract

MUDRA scheme was launched in 2015 under Pradhan Mantri MUDRA Yojana with the objectives of supporting micro unit entrepreneurship and financial inclusion in the micro units by providing collateral free loans to non-corporate / non-individual entities. This paper delves into the impact of the established scheme in relation to employment, financing, and business development with a special focus on women and vulnerable persons. However, the scheme has been effective in the goal of credit access and addendum comes with challenges like the increasing NPAs and the sustainability of employment generation. This research analyzes loan disbursements, non-performing assets and the financial sustainability of the program through quantitative and qualitative research methods. It provides policy recommendations to improve the effectiveness of the scheme. Greater emphasis on risk management, financial awareness, and the enhanced application of technology is necessary for the continued success and effectiveness of the MUDRA scheme as a model for the further development of the financial inclusion of the population in India. Some possibilities for further research are: focusing on particular industries and presenting the implementation differences at the regional level.