Schemes / Portal 12 November 2026
PM Mudra Scheme: Credit Guarantee Fund Extended Till 2031, ₹5,000 Crore Corpus Approved
Why in the News?
The Union Cabinet chaired by Prime Minister Narendra Modi approved the extension of the **Credit Guarantee Fund for Micro Units (CGFMU)** under the flagship **Pradhan Mantri Mudra Yojana (PMMY)** for five years until **March 31, 2031**.
Union Minister Ashwini Vaishnaw briefed that the Cabinet cleared a **₹5,000 crore corpus** to back collateral-free micro-financing.
Key Features / Major Points:
- Outlay & Credit Impact:
- The ₹5,000 crore corpus will facilitate new loans amounting to **₹12.6 lakh crore ($12.6 trillion)** over the 16th Finance Commission cycle (2026–27 to 2030–31).
- Reduction in Guarantee Fee:
- To lower borrowing friction, the annual guarantee fee charged to lending institutions has been reduced from **1% to 0.75% per annum**.
- (Guarantee fee for Self Help Groups remains unchanged at 0.25% for 1st year and 0.50% subsequently).
- Historical Cumulative Achievements:
- As of September 2026, over **60.36 crore loans** totaling **₹43.34 lakh crore** have been sanctioned since the inception of PMMY.
- Guarantee Scheme Operations:
- Managed by the **National Credit Guarantee Trustee Company Limited (NCGTC)**, providing risk cover against defaults.
- Covers Mudra loans up to ₹20 lakh, PMJDY overdrafts up to ₹10,000, and eligible SHG loans between ₹10 lakh and ₹20 lakh.
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Static GK Facts:
- Pradhan Mantri MUDRA Yojana (PMMY):
- Launched: **April 8, 2015** | Primary Agency: **MUDRA Ltd.**
- Loan Categories: Shishu (up to ₹50,000), Kishore (₹50,000 to ₹5 lakh), and Tarun/Tarun Plus (₹5 lakh to ₹20 lakh).
- Credit Guarantee Fund for Micro Units (CGFMU):
- Launched: **January 2016** | Trustee: **NCGTC**.
One-Liner Quiz (All Competitive Exams):
Q: Up to which date has the Credit Guarantee Fund for Micro Units (CGFMU) under PMMY been extended?
A: March 31, 2031
Q: What is the newly approved corpus amount to facilitate ₹12.6 lakh crore Mudra loans over the next 5 years?
A: ₹5,000 crore
Q: What is the revised annual guarantee fee for lenders under the extended CGFMU scheme?
A: 0.75% per annum (reduced from 1%)
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