Maximum Tenure and Pre Closure charges in Mudra Loans
After the implementation of the MUDRA Loan by the government of India, the small and medium sized business owners will be able to get the finances they require, in the form of credit and will be able to develop the base of their business. There is a lot that one needs to know before opting for these credit packages.
What is Maximum Tenure of Repayment?
When a business owner is opting for the loans, they will be able to acquire a sum that can amount to anything starting from Rs. 50,000 to a whopping Rs. 10 lakhs. The amount will be provided to the business owners on a credit basis from any of the nationalized or private banks, selected by the government of the nation. According to the guidelines, the creditor will get a time window of five years to repay the credit amount.
Maximum Tenure of Repayment in MUDRA Loan Scheme
According to the guidelines of the MUDRA Loan repayment policy, the creditor will get a time frame of seven years for repaying the total amount they have taken as a loan from the financial institution. If you see it in the term of months, then the business owners will get 84 months form making the repayment. The person opting for the loan will be able to pay the entire credit amount back in 84 easy and monthly installments. The time span was 5 years previously.
What is Pre Closure?
If a person has taken a loan from any financial institution, they he/she will have to pay the amount within a specific time frame. In case the person gets a lot of money and wants to utilize the sum for repayment of the credit, before the term ends, then this is known as pre-closure. Most of the financial institutions stand to lose out on the interest amount that they get at the end of each year, as stated by the credit agreement. Thus, if a creditor is looking forward to opting for a pre-closure then it is obvious that the financial institutes will charge then a certain sum. This sum is termed as the pre-closure fee.
Pre Closure Rules or time in MUDRA Loan
As per the guidelines of the MUDRA loan scheme, the person opting for the credit under any package, will have the right to apply for repaying the entire amount at any time they deem fit. It means they will have the right to opt for pre-closure at any moment. But the decision of opting for the pre-closure will come with a price. The creditors, no matter which package of loan they have applied for, will have to deposit an amount of Rs. 5000 as the pre-closure charge. Even if you are paying the amount after the completion of 5 years, you will have to deposit the pre-closure fee in the financial institutes.
Maximum Tenure and pre closure in Banks (SBI HDFC PNB ICICI)
If the creditor has opted for the any of the MUDRA loan packages form the financial institutions like SBI, HDFC, PNB or ICICI then they will get the specified time of 5 years, for paying the loan amount. According to latest reports, the tenure might be increased to 7 years. In case the creditor is option for paying the amount before the completion of the tenure, then all the above mentioned banks will charge an amount of Rs. 5000 form the creditor. The banks will provide the creditor with the right of pre-closing the credit account whenever they desire, as long as they pay the pre-closure charge.