KERALA FINANCIAL CORPORATION TO LEND UP TO ₹2 CRORE TO MSMES AT 5% RATE

Kerala Financial Corporation (KFC), a leading Kerala Government-owned Financial Institution, has enhanced the upper loan limit under the CM'S Entrepreneurship Development Programme (CMEDP) to ₹2 crore so that Micro, Small and Medium Sector enterprises of the State get loans at five per cent interest rate.

The decision has been taken after the State Government had issued an order in this regard as per the declaration made by Hon. Finance Minister while presenting the Budget 2022-23. The Government of Kerala will provide a subsidy of three per cent with the Corporation chipping in with two per cent to make the effective interest five.

The Corporation has so far assisted a total of 2122 units under the scheme and the target is to lend 2,500 enterprises in five years at the rate of 500 enterprises every year, for which the Corporation will set aside ₹500 crore every year.

Aspirant Industrial units must have MSME registration and the age of the chief entrepreneur should be below 50 years. The age limit for SC/ ST entrepreneurs, women entrepreneurs and nonresident Keralites is 55 years. Loans are available for starting new ventures and modernising existing ones.

The loan will be made available up to 90 per cent of the project cost.

Large projects will get even higher disbursements, in which cases, loans up to ₹2 crore will be sanctioned at the rate of five per cent and the balance at normal interest rates. The repayment period is up to 10 years. However, the interest subsidy will be limited to the first five years.

KFC also declared a business campaign with 50% waiver in the processing fees for new MSME loans and 0.25% interest discount for top-rated clients as part of the International MSME day celebrations.