Prime Minister Narendra Modi launched MUDRA Bank which will provide credit of up to Rs 10 lakh to small entrepreneurs and act as a regulator for 'Micro-Finance Institutions' (MFIs). Big industrial houses provide jobs to only 1.25 crore people, while small entrepreneurs employ 12 crore people, Modi said after launching the Mudra Bank and added, increasing employment is top priority of the government.

"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 Finance Ministry said. "The initial products and schemes under this umbrella have already been created and the interventions have been named 'Shishu', 'Kishor' and 'Tarun' to signify the stage of growth / development and funding needs of the beneficiary micro unit / entrepreneur," the Ministry said.

Shishu would cover loans up to Rs 50,000 while Kishor above Rs 50,000 and up to Rs 5 lakh. Tarun category will cover loans of above Rs 5 lakh and upto Rs 10 lakh. "Further, the approach goes beyond credit only approach and offers a credit - plus solution for these enterprises spread across the country," the Ministry said.

By Premji