In his first full-fledged budget in February 2015, Finance Minister Arun Jaitley had announced the setting up of MUDRA (Micro Units Development & Refinance Agency Limited). Consequently, Prime Minister Modi announced the Pradhan Mantri Mudra Yojana (PMMY), a scheme meant to provide easy capital up to Rs 10 lakh (Rs 1 million) to small and micro enterprises.

The disbursements under this scheme since its inception has been rather impressive. But for reasons unknown, the money given out under this scheme has not increased overall credit offtake among small and micro industries ...