Canara Bank MUDRA Loan Features 2025

Canara Bank provides partnerships, self-help groups, and independent contractors with a MUDRA loan facility of up to Rs 10 lakh to enable them to raise money for their business needs. Canara Bank MUDRA Loan is available to potential candidates as a working capital loan facility or as a term loan.

Canara Bank MUDRA Loan Features 2025

Interest Rates

MSME Manufacturing and Services – up to Rs 2 lakhs:

• For Working Capital Loan: 10.30% p.a.
• For Term Loan: 10.55% to 10.80% p.a.

MSME Manufacturing and Services – above Rs 2 lakhs:

• 10.65% to 15% p.a.

Read Also: HDFC Bank MUDRA Loan

Loan Amount

• Shishu: Loans up to Rs 50,000
• Kishore: Loans from Rs 50,001 to Rs 5 lakh
• Tarun: Loans from Rs 5 lakh to Rs 10 lakh

Loan Tenure

• Working Capital Loan: Up to 1 year
• Term Loan: Payable in monthly or equivalent monthly installments for a maximum of five to seven years.
• The lender may provide repayment holiday of 2 to 3 months wherever necessary

Margin

Up to Rs 25,000: Nil

Above Rs 25,000: 15% to 25% (30% if the borrower offers book debts as the primary collateral)

Security

Primary:

With the hypothecation of movable assets, the mortgage of immovable property, and the existing business assets, the assets generated from the loan are regarded as the principal security.

Collateral:

Canara Bank’s Shishu MUDRA Loan is not backed by any security collateral or a guarantee by any third party.

Note: Interest Rates as on 02 Jan 2025

Canara Bank MUDRA Loan Interest Rates

Interest rates for Canara Bank’s MUDRA Loans start at 10.30% annually. The following are the interest rates offered on MUDRA loan schemes:

MSME Manufacturing and Services – up to Rs 2 lakhs

• For Working Capital Loan: 10.30% p.a.
• For Term Loan: 10.55% to 10.80% p.a.

MSME Manufacturing and Services – above Rs 2 lakhs

10.65% to 15% p.a.

Note: Term loans with repayment terms longer than one year and up to five years are subject to a liquidity charge of 0.40% per annum.

Canara Bank MUDRA Loan Fees & Charges

The fees and charges associated with Canara Bank’s MUDRA lending schemes have not been specified. Conversely, lenders offering MUDRA loans usually impose late payment fees, processing charges, and fees for early part pre-payment or foreclosure of the loan.

Type of Canara Bank MUDRA Loans

Shishu MUDRA Loan

Purpose: The Canara Bank Shishu MUDRA lending is a subvention short-term micro-lending program to suit the money requirements of the borrowers challenged with the cash flows.

Loan amount: Rs 10,000 to Rs 50,000

Loan tenure: 1 year to 3 years

Security: Hypothecation of the loan-generated assets. The loan is covered by the Credit Guarantee Fund for Micro Units (CGFMU).

Read Also: Common Mistakes to Avoid When Applying for a MUDRA Loan

Canara Bank e-MUDRA Loan Eligibility Criteria

• The following are the requirements to be eligible for Canara Bank e-MUDRA Loans:
• This MUDRA loan program is available to individuals, partnerships, proprietorships, and self-help organizations.
• This loan program is not available to trusts, Hindu Undivided Families (HUF), or private limited corporations.
• Current clients of the lender who have demonstrated a solid performance history over the past two years (both in terms of managing their accounts with the financing branch and the financials of their business units)
• New clients that provide a positive opinion letter from their current banks
• New units as long as their promoters’ market perception remains favorable
• According to the scoring guidelines, units with a “High” risk rating and/or a higher/highest grading are not qualified for this loan.
• The loan applicant shouldn’t have a history of nonpayment to any other lender.
• In order to determine the borrower’s net worth in the absence of a third-party guarantee, the lender may request the borrower’s asset and liabilities statement, including those of its directors and partners.

Eligibility for Shishu e-MUDRA Loans

• This program is accessible to both proprietary businesses and Udyam-registered people.
• Minimum Age: 25 years
• Maximum Age: 55 years.
• Satisfactory credit history in accordance with the lender’s guidelines

Documents Required for Canara Bank e-MUDRA Loan

• The following are the supporting documents required for Canara Bank e-MUDRA Loans:
• Proof of customer identification and the NF998 MSME application
• Address Proof of both promoters and business unit
• Financial papers for last 2 years with ITR and projections of next 1 year
• License/permissions
• Details of Guarantor with proof of assets
• Project Report containing details of technical & economic viability
• Sales made throughout the current fiscal year as of the application’s submission

For Shishu e-MUDRA Loan

• Aadhar card
• PAN card
• Udyam Registration Certificate
• Bank statement

Note – The information furnished in this article totally lies under the jurisdiction of RBI and is subject to change by the institution.