Question

69. Consider the following statements related to MUDRA- Micro Units Development & Refinance Agency Ltd.,

i. It will initially function as a non-banking financial company and a subsidiary of the Small Industries Development Bank of India (SIDBI)

ii. It will classify its clients into two categories and the maximum allowed loan sums will be based on the category.

Which of the above is/are correct?

• A. a) i only
• B. b) ii only
• C. c) Both i and ii
• D. d) None

Answer 1

The correct option is A

a) i only

Ans 69.A

Explanation: Micro Units Development and Refinance Agency Bank (or MUDRA Bank) is a public sector financial institution in India. It provides loans at low rates to micro-finance institutions and non-banking financial institutions which then provide credit to MSMEs. It will initially function as a non-banking financial company and a subsidiary of the Small Industries Development Bank of India (SIDBI). Later, it will be made into a separate company. It was also to act as regulator of MFIs, earlier; but it will be done by RBI now.

It will classify its clients into three categories and the maximum allowed loan sums will be based on the category.

• Shishu: Allowed loans up to 50,000

• Kishore: Allowed loans up to 5 lakh

• Tarun: Allowed loans up to 10 lakh