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This scheme aims to boost nano and household businesses by providing interest relief on loans for their Read More... setup and growth. Read less
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Starting or running a small business from home can be tough, especially when it comes to managing loan repayments. Recognizing this, the Kerala government has launched the 'Scheme for Interest Subvention to Nano Household Enterprises'. This initiative is designed to support small-scale and household businesses by easing their financial burden.
What is the Scheme for Interest Subvention to Nano Household Enterprises?
This scheme offers financial help to nano and household enterprises. It works by providing interest subvention, which essentially means a reduction in the interest you pay on a term loan taken for your business. This support is given on a reimbursement basis for the first three years of your loan. The goal is to make it easier for these small ventures to get off the ground and sustain themselves.
Who Can Benefit From This Scheme?
The scheme is specifically for small businesses and household units engaged in manufacturing, providing services, or doing job work. If your business has a fixed capital investment of ₹10 Lakhs or less, falls under the 'white' or 'green' pollution control categories, and has a connected load of 5 HP or less, you could be eligible.
Why This Scheme Is Important
The scheme plays a crucial role in fostering entrepreneurship at the household level. It aims to create more jobs within homes, boost the earning potential of individuals, and provide sustainable employment. By addressing specific needs not covered by other government schemes, it offers targeted support to a vital segment of the economy. This financial relief during the critical early years of a business helps ensure its survival and growth.
Objective
Benefits
Sources and references
Who Can Apply?
To be eligible for this scheme, your unit or enterprise must meet the following conditions:
- Your total fixed capital investment should not exceed ₹10 Lakhs.
- You must be engaged in manufacturing, providing services, or undertaking job work.
- Your unit must comply with 'white' and 'green' category pollution control norms.
- The connected electricity load for your unit should be 5 HP or less.
Applicant's Responsibilities
As an applicant, you are expected to:
- Provide all requested details accurately and declare that the information is true.
- Offer clarifications if the recommending or sanctioning authority asks for more details.
- Allow inspections or verifications of your application details, including your plant, machinery, and other assets, if required.
- Present original documents for verification when requested by the recommending or sanctioning authority.
How to Apply
You can submit your application in two ways:
- In Person: Submit your application along with all supporting documents to the Assistant District Industries Officer at the Taluk Industries Office in your area.
- Online: You can also apply online through the official website of the Directorate of Industries & Commerce, Government of Kerala.
Official Website for Online Applications:
https://schemes.industry.kerala.gov.in/public/index.php/schemes
Documents You Need to Submit
Ensure you have the following documents ready when applying:
- A copy of your identity proof.
- Statement from the financial institution regarding the term loan.
- Bank statement file from the bank.
- Amount statement file from the bank.
- A declaration from the promoter, duly signed.
- Annexure-II: Recommendation from the financial institution.
- Any other documents that the recommending or sanctioning authority may require.
FAQ’s
What is the main goal of this interest subvention scheme?
The primary goal is to help nano and household businesses by reducing the interest they pay on term loans. This support is given back to them (reimbursement) for the first three years, making it easier to manage their finances.
Are there any specific types of businesses that cannot apply?
Yes, certain businesses are excluded. This includes Photo Studios, Colour Processing Centres, Breweries, Distilleries, Sawmills, units involved in Asbestos processing (unless specific conditions are met), Metal Crushers, Steel Re-rolling Mills, units manufacturing iron ingots, Calcium Carbide, Cement manufacturing (except from fly ash), Cashew industries, and heavily power-intensive units (over 5000 KVA contract load or power cost exceeding 33% of production cost, unless they generate their own power).
What are the objectives behind this scheme?
The scheme aims to create more jobs within households, improve employment potential by bringing units together, ensure steady income for unorganized workers, and address needs not covered by national or state schemes. It specifically supports manufacturing, job work, and service units with investments up to ₹10 Lakhs, offering interest relief for three years.
If I already get a special low interest rate from a government agency, can I still get this subvention?
No, if you have already availed a special low interest rate from any government agency, you are not eligible to receive further interest subvention under this particular scheme.
What happens to the interest subvention if my business loan becomes an NPA?
If your loan is classified as a Non-Performing Asset (NPA) by the bank during the second or third year, you will not receive the interest subvention for those years. The subvention is also forfeited if you default on repayment with interest at the end of the first year.
What is the interest subvention rate for regular enterprises?
Regular enterprises eligible under this scheme can receive an interest subvention of 6% per annum on their term loan for a period of three years.
Which department manages this scheme?
This scheme is managed by the Director of Industries & Commerce, under the Government of Kerala.
How can I apply for this scheme?
You can submit your application either by visiting the Assistant District Industries Officer at your local Taluk Industries Office or by applying online through the official website: https://schemes.industry.kerala.gov.in/public/index.php/schemes.
What is the maximum capital investment allowed for a business to be eligible?
To be eligible for this scheme, your unit's fixed capital investment must be ₹10 Lakhs or less.
What benefits does the scheme offer?
The scheme offers interest subvention on term loans for three years. Standard beneficiaries get 6% per annum subvention, while women and SC/ST enterprises receive 8% per annum. This relief is provided on a reimbursement basis.
What are the main criteria for a business to be considered eligible?
An enterprise is eligible if its fixed capital investment is ₹10 Lakhs or less, it's involved in manufacturing, services, or job work, meets 'white'/'green' pollution norms, and has a connected load of 5 HP or less.
Are there any specific service activities that are listed as eligible?
Yes, an indicative list of eligible service activities includes processing and preserving of meat, fish, fruits, and vegetables; repair services for computers, electronics, and vehicles; laundry services; photocopying; and waste treatment. Other similar value-adding service activities recommended by the District Level Committee are also considered.
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