PM Modi launches MUDRA Bank aimed to benefit 5.77 crore MFIs in India

"We want to provide power to small and micro entrepreneurs. Through MUDRA bank we want to fund the unfunded," PM Modi said as he unveiled Mudra Logo and launched Pradhan Mantri MUDRA Yojana.

The bank will not only provide credit of up to Rs 10 lakh to small entrepreneurs but will also act as a regulator for 'Micro-Finance Institutions' (MFIs).

MUDRA will lay down policy guidelines for micro enterprise financing business and register MFI entities as well as their accreditation and rating.

Modi also distributed  loans to few MUDRA clients.

"We need to increase employment opportunities in the Nation," Modi said at the launch event.

"The work of the banking sector in Jan Dhan Yojana is immense," the PM said.

Speaking on the functions of MUDRA, he said, "Today 5.77 crore small business units employ more than 12 crore people. Most of these are owned by people bwlonging to SC, ST, or OBC. Only 4% of such units get institutional finance."

He said MUDRA Bank will regulate and refinance MFI adding that: "MUDRA Bank will partner state level coordinators to provide finance to last mile financer of small/micro enterprise business."

During the event, the PM also said that: "We have to worry about the farmer of India, who faces problems due to lack of adequate of rainfall or due to unseasonal rain. Ministers have gone to the farmers and taken stock of the situation. Met Ministers to chalk out how we can help the farmers."

Union Finance Minister Arun Jaitley earlier said: "Providing access to institutional finance to such micro/small business units/enterprises will not only help in improving the quality of life of these entrepreneurs but also turn them into strong instruments of GDP growth and employment generation."

The launch was followed by screening of a film on MUDRA Bank.