The Union Cabinet has approved the conversion of MUDRA Ltd into MUDRA (SIDBI) Bank as, a wholly owned subsidiary of SIDBI to carry out the following functions:

i) Refinance operations,

ii) Support services with focus on portal management, data analysis etc,

iii) Any activity entrusted/advised by Government of India

MUDRA Ltd, has been functional since April 8, 2015. It has written to Reserve Bank of India for conveying concurrence for the conversion of the Company to MUDRA (SIDBI) Bank Ltd.

This was stated by Shri Jayant Sinha, Minister of State in the Ministry of Finance in written reply to a question in Lok Sabha.

Conversion to bank status: MUDRA Ltd approved as a wholly owned subsidiary to carry out refinance and support functions. Conversion of MUDRA Ltd into a bank subsidiary was approved to make it a wholly owned subsidiary of the designated development finance institution to undertake refinance operations, support services including portal management and data analysis, and activities entrusted by the Government of India. The company, functional since 8 April 2015, has applied to the banking regulator for concurrence for the conversion; the approval and regulatory application were reported in a ministerial parliamentary reply and press release.