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Stand-Up India vs Mudra vs PMEGP

स्टैंड-अप इंडिया, मुद्रा और पीएमईजीपी

Stand-Up India, Mudra and PMEGP are the three government-backed routes most new entrepreneurs look at. They are built for different situations:

• Stand-Up India is for women, SC and ST entrepreneurs who need a larger loan, above ₹10 lakh and up to ₹1 crore, for a brand-new business.
• Mudra (PMMY) gives collateral-free loans of up to ₹10 lakh to any eligible individual with a business plan, or up to ₹20 lakh under Tarun Plus after a Tarun loan is repaid.
• PMEGP is the only one of the three with a subsidy: up to 35% of project cost as margin money for new micro units, on projects of up to ₹50 lakh in manufacturing or ₹20 lakh in services.

The right choice depends on your loan size, your category, whether the business is new, and whether you want a subsidy.

The short answer

Side-by-side comparison

Sources: PIB, 11 November 2026; Stand-Up India scheme features; PIB, 25 March 2025 (Mudra); PIB, 5 December 2025 (PMEGP); PIB, 18 September 2020 (PMEGP rates); PIB, 5 June 2026 (JanSamarth).

Who each scheme is for

Stand-Up India is limited to women, SC and ST entrepreneurs above 18. A firm qualifies if SC/ST and/or women hold at least 51% and control it. Read the full eligibility rules.

Mudra is open to any individual who is otherwise eligible for a loan and has a business plan. There is no category restriction.

PMEGP is open to individuals above 18, and also to self-help groups, registered societies, production co-operatives and charitable trusts. It has a “special category” that gets a higher subsidy. This covers SC, ST, OBC, minorities, women, ex-servicemen, persons with disabilities, and applicants in the North-East, hill and border areas.

Loan size bands

The three schemes fit together like steps:

The Stand-Up India FAQs say this directly: for loans below ₹10 lakh, banks already lend under their existing schemes and under Mudra’s Shishu, Kishor and Tarun categories.

Subsidy: only PMEGP gives one

PMEGP pays a margin-money subsidy on the project cost:

Source: PIB, 18 September 2020; the maximum of 35% is confirmed in the PIB release of 5 December 2025.

Neither Stand-Up India nor Mudra gives a subsidy. Both are loans that you repay in full with interest. Stand-Up India does let support from other central or state schemes count towards its margin money. Your own contribution of at least 10% of the project cost cannot be replaced, though. See margin money.

New or existing business

• Stand-Up India: new only. The project must be your first venture in that sector. Expansion and takeover are excluded.
• PMEGP: new projects only.
• Mudra: for income-generating activities by anyone with a business plan. It is not described as new-units-only, and Tarun Plus is itself for borrowers who have already repaid a Tarun loan. If you already run a business and need a loan to grow it, Mudra is the scheme of the three to ask about.

Collateral and guarantees

Mudra loans are collateral-free. Stand-Up India loans can be backed by the CGSSI credit guarantee, so the bank can lend without collateral, though it decides whether to ask for collateral or use the guarantee. For PMEGP, ask your bank and check the PMEGP portal for current terms.

Interest and repayment

Stand-Up India sets an interest ceiling: the bank’s lowest rate for your rating category, not above MCLR + 3% + tenor premium. Repayment runs up to 7 years with up to 18 months’ moratorium. Mudra and PMEGP loans follow each lender’s rates and the terms of those schemes. Ask the bank for a written quote under each scheme you are considering and compare the total cost.

Where to apply for each

More on Mudra: mudra.org.in. For Stand-Up India, follow how to apply.

Can you combine them?

Each scheme has its own appraisal, so ask your bank before you plan two scheme loans for one project. The schemes can work together in some ways:

• Margin money from other schemes. Stand-Up India allows convergence with eligible central or state schemes to meet the margin, for example a state subsidy or margin-money support from a state SC/ST or women’s development corporation.
• Moving up later. A Mudra borrower who repays a Tarun loan becomes eligible for Tarun Plus, up to ₹20 lakh. Stand-Up India is for a first venture, so it is not a “next step” for a business you already run.

Ask your bank how any subsidy will be shown in the project’s funding plan.

Questions to answer before you choose

Write down your answers to these five questions. They usually point to one scheme straight away.

1. Is the business new? If not, Stand-Up India and PMEGP are out.
2. How much does the whole project cost? Include machinery, setup and the first months’ working capital, not just the loan you hope for.
3. How much can you put in yourself? Stand-Up India needs at least 10% of project cost from you.
4. Are you a woman, SC or ST entrepreneur? If not, Stand-Up India is out, but PMEGP and Mudra remain open.
5. Is the activity manufacturing, services, trading or agri-allied? PMEGP is for non-farm micro units. Stand-Up India covers trading and agri-allied activities such as dairy and fisheries too.

If two schemes still fit, compare the written terms from the bank: the loan, your own share, any subsidy, the interest rate and the repayment period.

Common mistakes when choosing

• Applying under Stand-Up India for an existing shop. Expansion and takeover are not covered, so the application will not fit the scheme.
• Asking for exactly ₹10 lakh under Stand-Up India. The loan must be above ₹10 lakh. If ₹10 lakh is enough, Mudra Tarun covers it.
• Expecting a subsidy from Stand-Up India. There is none. If a subsidy matters most, start with PMEGP and check whether your project fits its cost limits.
• Ignoring the own contribution. Stand-Up India needs at least 10% of project cost from you, even if a subsidy covers part of the margin.
• Comparing only interest rates. Look at the full cost: rate, fees, guarantee fee, insurance and repayment period.

A worked comparison

Take an ST woman planning a new ₹40 lakh food-processing unit in a village.

Here PMEGP’s subsidy makes it worth checking first. If she does not fit PMEGP’s rules, Stand-Up India covers the same project as a loan.

Decision guide by situation

FAQ

Which is better, Mudra or Stand-Up India? Neither is better overall. Mudra suits loans up to ₹10 lakh (₹20 lakh under Tarun Plus) and existing businesses. Stand-Up India suits women, SC and ST founders who need more than ₹10 lakh for a new business.

Can I take PMEGP and Stand-Up India together? Not as two loans for one project. Support from other schemes can count towards Stand-Up India’s margin money, but your own 10% stays. Discuss the funding plan with your bank.

Is there a subsidy in Stand-Up India? No. Only PMEGP of these three gives a subsidy.

Which scheme is for an existing business? Of these three, Mudra. Stand-Up India and PMEGP are for new units only.

Can a man from the general category get any of these? Yes. Mudra and PMEGP. Stand-Up India is limited to women, SC and ST entrepreneurs.

Also read the Budget 2025-26 scheme for first-time entrepreneurs. Back to the Stand-Up India overview.

Last reviewed: 12 November 2026.