Answer:
Mudra Loan is a type of loan designed specifically to support micro and small enterprises with a maximum loan amount of Rs. 10 lakh. It is an unsecured loan, meaning that borrowers do not need to provide collateral to avail the loan.
- An example of a borrower who may benefit from a Mudra Loan is a small-scale artisan or a small retail business owner.
Business Loan, on the other hand, is a broader term that covers a range of loans offered to businesses for various purposes such as working capital, business expansion, or purchasing equipment. The loan amount for Business Loan can be significantly higher, depending on the borrower's creditworthiness and the lender's policies. Business Loans can be secured or unsecured, and collateral requirements will depend on the type of loan and the lender's policies.
- An example of a borrower who may benefit from a Business Loan is a mid-sized manufacturing company looking to expand their operations or invest in new technology.