PM MUDRA Yojana Tarun Loan: Rs 5 to Rs 10 Lakh Business Growth Loan

When your business reaches a significant size, you need substantial capital to scale further. The PM MUDRA Yojana Tarun Loan offers Rs 5 lakh to Rs 10 lakh without collateral. This top-tier MUDRA loan supports established businesses ready for expansion and modernization. Tarun means mature in Hindi, indicating your business has reached a stable and profitable stage. It helps manufacturing units, trading businesses, service enterprises, and professional setups achieve their growth goals without selling assets or pledging property.

Loan Amount and Interest Rates

Tarun Loan provides substantial financing with reasonable interest costs: Rs 5,00,000 to Rs 10,00,000 with interest rates of 7.5% to 11% per annum. Repayment period is 5 to 7 years with processing fees of 0.5% to 1.5% of loan amount. Moratorium period is up to 6 months (interest-free). Some banks offer lower rates if your credit profile is strong. Rates are also lower for SC/ST businessmen and women entrepreneurs.

Eligibility Criteria

You must be an Indian citizen aged 18 to 65 years with a business operating successfully for minimum 2-3 years. Annual business turnover should be minimum Rs 20 lakh with good credit history and on-time loan repayments. Your business should be profit-making (showing profits for last 2 years). You can be a sole proprietor, partnership, or small company. Professionals with established practice like doctors, lawyers, and consultants also qualify. If you’ve successfully repaid a Kishore Loan, you have a much better chance of approval.

Documents Required

Prepare: Identity and address proofs, recent photographs, comprehensive business plan and project report, bank statements (12-24 months), ITR for last 2-3 years, balance sheet and profit-loss statement, business registration and tax certificates, premises ownership or lease agreement, list of existing assets and equipment, and personal balance sheet (if applicable). The more detailed your documentation, the faster your approval.

Application Process

Prepare a detailed project report showing how funds will generate returns. Calculate expected revenue and profit projections. Visit your bank or apply through their online portal. Collect and complete the Tarun Loan application form. Gather and attach all required documents. Submit the complete application package. Bank’s loan committee reviews your proposal. Site inspection and business verification are conducted. Approval decision comes within 30-45 days. Post-approval documentation and fund disbursement follow.

Use Cases for Tarun Loan

Manufacturing setup or factory equipment, opening franchise outlets across cities, agricultural processing units, hospitality business expansion, technology and IT service offices, medical or diagnostic center setup, educational institution startup, and transport business fleet expansion.

FAQ

Can a startup apply for Tarun Loan directly?
No, you need at least 2-3 years of operating business history. Startups should begin with Shishu Loan first.

What if my business isn’t making profit yet?
You need to show profits for at least the last 2 financial years to be eligible for Tarun Loan.

Can partnership firms apply?
Yes, partnership and private company businesses can apply with all partners’ details and personal guarantees.

Is there a higher loan category beyond Tarun?
Yes, MUDRA Tarun Plus Loan offers up to Rs 20 lakh for businesses with strong track records.