Now Reading: Mudra loan limit raised to ₹20 lakh under Tarun Plus category
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Mudra loan limit raised to ₹20 lakh under Tarun Plus category
The government's Mudra loan scheme now offers loans up to ₹20 lakh under the Tarun Plus category, launched in 2024. The scheme has four categories: Shishu (up to ₹50,000), Kishor (₹50,001 to…
The government's Mudra loan scheme now offers loans up to ₹20 lakh under the Tarun Plus category, launched in 2024. The scheme has four categories: Shishu (up to ₹50,000), Kishor (₹50,001 to ₹5 lakh), Tarun (₹5,00,001 to ₹10 lakh) and Tarun Plus (₹10,00,001 to ₹20 lakh). All loans are collateral-free, though lenders assess eligibility, business needs and repayment capacity before approval.
Mudra loans can be used for small businesses such as shops, service centres, manufacturing units, trade, transport, dairy, poultry and agriculture-linked activities like beekeeping. Loans are available through banks, regional rural banks, small finance banks, NBFCs and microfinance institutions. As of March 2026, loans worth ₹9.02 lakh crore were disbursed to women under Shishu, ₹6.22 lakh crore under Kishor and ₹1.09 lakh crore under Tarun. Among minority borrowers, ₹1.33 lakh crore was disbursed under Shishu, ₹1.54 lakh crore under Kishor and ₹0.62 lakh crore under Tarun.
Indian Opinion Analysis
The Pradhan Mantri Mudra Yojana (PMMY), launched in 2015, was designed to extend credit to the vast informal sector, the smallest shopkeepers, artisans and self-employed workers whom banks typically avoid. The scheme's architecture of Shishu, Kishor and Tarun tiers allowed a borrower to graduate from a micro-loan of ₹50,000 to a substantial one of ₹10 lakh, building a credit history along the way. The late 2024 addition of Tarun Plus, doubling the ceiling to ₹20 lakh, signals a government push to retain growing small businesses within the formal banking fold rather than see them migrate to costlier NBFCs or informal lenders. At stake are the roughly 63 crore accounts that have cumulatively been sanctioned over ₹26 lakh crore under the scheme since 2015.
Source: businesstoday.in
This story was synthesised by AI from the source linked above.
