Mudra Loan ₹20L: Can You Get One Without Collateral?

HDB Financial Services has joined the Mudra loan scheme, letting small business owners borrow up to ₹20 lakh without pledging any asset. Here is what this means for you and how to apply.

Here's what happened: HDB Financial Services, a large NBFC, has officially joined the Pradhan Mantri Mudra Yojana, expanding the pool of lenders offering collateral-free business loans to micro-entrepreneurs.. Under PMMY, eligible borrowers can access loans from ₹50,000 all the way up to ₹20 lakh depending on their business stage and past repayment track record — all without pledging any property.. The Credit Guarantee Fund for Micro Units (CGFMU) covers the lender against default risk, which is what makes zero-collateral lending commercially viable for NBFCs like HDBFS..

What you should do: Check which Mudra slab you qualify for — Shishu (up to ₹50K), Kishore (up to ₹5L), Tarun (up to ₹10L), or Tarun Plus (up to ₹20L) — based on your business age and past loan history.. Compare interest rates across PSU banks, regional rural banks, MFIs, and now NBFCs like HDB Financial Services before applying — Mudra sets no interest rate cap, so rates vary significantly.. Keep your GST registration, Udyam registration certificate, and last 6 months of bank statements ready — these three documents speed up Mudra loan processing at any lender..

If you already repaid a Shishu or Kishore Mudra loan cleanly, explicitly mention that repayment record when applying for a higher slab — lenders treat it as a strong credit signal even if your CIBIL score is thin.