MCQ

Pradhan Mantri Mudra Yojana MCQ - Practice Questions with Answers

Solve 5 Pradhan Mantri Mudra Yojana questions for RAS/RPSC preparation.

Practice questions

Q1Which applicant and purpose combination is eligible for credit under Pradhan Mantri Mudra Yojana?

A An individual seeking a loan solely for a family holiday

B A partnership seeking working capital for an income-generating food-processing unit

C A defaulter seeking funds to repay an overdue bank loan

D A household seeking finance only to buy consumer electronics

Explanation

Partnerships are among the eligible legal forms, and working capital for an income-generating processing enterprise is an eligible use. The scheme covers manufacturing, processing, trading, services and activities allied to agriculture, but excludes pure personal consumption and expects a satisfactory credit record.

Q2Which of the following statements about delivery and safeguards under Pradhan Mantri Mudra Yojana is incorrect?

A MUDRA-appointed agents and middlemen are the prescribed channel for submitting loan applications.

B Scheduled commercial banks and regional rural banks may extend eligible loans.

C The MUDRA Card is a RuPay-based working-capital product with flexible overdraft use.

D Guarantee coverage for eligible loans up to Rs 20 lakh is provided through the Credit Guarantee Fund for Micro Units.

Explanation

Option A is incorrect because MUDRA has no agents or middlemen; applicants should approach eligible lenders or official credit portals directly. Scheduled commercial banks and regional rural banks are valid lenders, the MUDRA Card supports flexible working-capital use, and guarantee coverage extends through the specified fund up to Rs 20 lakh.

Q3Which institution serves as the refinance and support institution under Pradhan Mantri Mudra Yojana but does not lend directly to individual entrepreneurs?

A MUDRA Ltd.

B Department of Financial Services

C Credit Guarantee Fund for Micro Units

D A scheduled commercial bank

Explanation

MUDRA Ltd., a wholly owned subsidiary of SIDBI, provides refinance and institutional support rather than retail loans to individual entrepreneurs. The Department of Financial Services is the nodal department, while banks and other member lenders actually appraise and extend the loans.

Q4Match List I with List II and select the correctly matched code. List I: 1. Shishu 2. Kishor 3. Tarun 4. Tarun Plus. List II: a. Above Rs 5 lakh and up to Rs 10 lakh b. Up to Rs 50,000 c. Above Rs 10 lakh and up to Rs 20 lakh, subject to successful repayment of an earlier Tarun loan d. Above Rs 50,000 and up to Rs 5 lakh.

A 1-a, 2-b, 3-d, 4-c

B 1-b, 2-a, 3-d, 4-c

C 1-d, 2-b, 3-a, 4-c

D 1-b, 2-d, 3-a, 4-c

Explanation

The correct sequence follows the four ascending slabs: Shishu is up to Rs 50,000; Kishor is above Rs 50,000 and up to Rs 5 lakh; Tarun is above Rs 5 lakh and up to Rs 10 lakh; and Tarun Plus is above Rs 10 lakh and up to Rs 20 lakh for a borrower who successfully repaid an earlier Tarun loan.

Q5Consider the following statements about the Tarun Plus category: 1. It covers loans above Rs 10 lakh and up to Rs 20 lakh. 2. It is available only to entrepreneurs who earlier availed and successfully repaid a Tarun loan. Which of the statements given above is/are correct?

A 1 only

B 2 only

C Both 1 and 2

D Neither 1 nor 2

Explanation

Both statements are correct. Tarun Plus extends the range beyond the earlier Tarun ceiling by covering loans above Rs 10 lakh and up to Rs 20 lakh. Access is restricted to entrepreneurs who previously took a Tarun-category loan and repaid it successfully; it is not an unrestricted first-time slab.

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