New Delhi [India], April 2 : Pradhan Mantri Mudra Yojana (PMMY) disbursements are benefiting financially weaker regions more, improving financial inclusion in underdeveloped states, according to a report by SBI Research.
"A financial inclusion metric show Mudra disbursements have a stronger impact on states with lower financial inclusion levels," the report added.
The report, which analyzes the impact of PMMY, states that states with a higher share of disbursements to women have significantly shown higher employment creation by women-led MSMEs, further reinforcing the efficacy of targeted financial inclusion policies in fostering economic empowerment and labour market participation.
The SBI analysis shows that while the overall diversity (entropy) of Mudra disbursements has become more skewed, this skewness reflects a positive structural shift.
The report highlights that the proportions allocated to developed regions have declined, while underdeveloped regions such as Bihar (from 5.67 per cent to 10.97 per cent), UP (from 9.27 per cent to 11.30 per cent), Odisha (from 4.24 per cent to 4.51 per cent), and the North East have experienced significant gains. This demonstrates a strategic reorientation of the Mudra scheme towards regions that need it the most.
The Government of India set up Pradhan Mantri Mudra Yojana (PMMY) under the Micro Units Development and Refinancing Agency (MUDRA) to develop and refinance micro units.
Launched in 2015, PMMY ensures collateral-free institutional credit up to Rs 20 lakh is provided by Member Lending Institutions (MLIs), i.e. Scheduled Commercial Banks (SCBs), Regional Rural Banks (RRBs), Non-Banking Financial Companies (NBFCs) and Micro Finance Institutions (MFIs).
Further, the report highlights that increasing women's participation in PMMY leads to better financial situations for women borrowers. About 68 percent of account holders under the scheme are women.
In the last nine years (FY25 over FY16), while per woman PMMY disbursement amount increased by a CAGR of 13 per cent to Rs 62,679, the per woman incremental deposits increased by a CAGR of 14 per cent to Rs 95,269 branding PMMY an effective power tool for women empowerment at grass roots level, the report observed.
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