MUDRA Loan Pre closure Charges And Repayment schedule
MUDRA loan is a financial assistance that the government has set out to give to the small and the medium level businesses. This type of loan is being offered without any collateral. The aim is to provide enough assistance so that the small businesses get a boost. But before opting for it, you must know a few details.
What is maximum tenure of repayment?
You can repay the entire loan within five years. This means whether you take a Shishu loan of Rs. 50,000 or a Tarun loan of Rs. 10 lakhs, the maximum time limit given to return this is 5 years at most.
Maximum tenure of repayment (Repayment schedule ) in MUDRA loan scheme
So we learned about the previous rule regarding repayment of the credit amount. Now if you ask about the full payment – that is, loan amount including the interest, then you will get a total frame of seven years to repay it. This means that you will get total 84 months intact for repaying the amount in full. You can choose to pay it once at all or you can opt for 84 EMIs for repayment. Earlier you could repay it in 60 months or 5 years but now this time has been expanded.
What is pre closure?
Pre-closure refers to the situation when the person uses some of the loaned amount to repay the loan. This means suppose you got Rs. 10 lakh sanctioned as loan. Now you have used only Rs. 5 lakh in your business and the rest of the amount you are repaying before the term ends. This is the situation of pre closure.
However, it will prove to be a loss for the financial institutions. They will not get interest on the rest of the sum. Hence they lose a portion of the deal. To even this out, the government has allowed the financial institutions to take extra fees. This is particularly calculated as pre closure fee. So this means that if you want to pay a pre closure on your loan amount, you will have to give a pre closure fee to the financial institutions.
Pre closure rules or time in MUDRA loan
The rules on pre closure under MUDRA Yojana state that you can repay the loan any time within the tenure. You can choose to repay any part of the amount and the financial institutions shall have to accept the repayment. However, there is a small charge that you have to bear for the same. This charge shall be levied uniformly, on all the MUDRA loaners who choose pre closure.
MUDRA loan pre closure charges
MUDRA loan regulations do allow the borrower to opt for pre closure at any point of time. But the borrowers will have to remember that this comes with a price because the creditors will otherwise lose out on their loaned amount. Thankfully this comes at a cheaper rate than imagined. The borrower will have to deposit only Rs. 5000 – irrespective of the loan amount – if they are opting for pre closure. So the set and defined pre closure charge, approved by the government, is Rs. 5000 only.
Maximum tenure and pre closure in banks (SBI HDFC PNB ICICI)
The maximum time given for repaying the loan by banks like SBI, HDFC, PNB and ICICI is 5 years. It may increase to 7 years in future. If you are opting for pre closure then you have to pay these banks Rs. 5000 as a fee. These two rules stay the same whether you are a Shishu, Kishore or Tarun borrower.
All the regulations have to be followed as per the guidance laid out by the central government. This means that irrespective of the bank, your regulations pretty much remain the same.