Finance Minister of Kerala, K N Balagopal has announced a package of Rs 5,650 crore to assist the small-scale traders and farmers of the state. He said in the state Assembly that the package is to revive the state economy that is struggling due to the Covid-19 pandemic.
The state government has decided to provide subsidised loans and announced new loan schemes under the Kerala Financial Corporation (KFC) and the Kerala State Financial Enterprises (KSFE). There is a moratorium of one year for the loans taken by small-scale enterprises from the KFC.
Loans up to ₹ 1 crore at a 5% interest rate for 500 business enterprises a year are also in the plans. The government will bear 4% of the interest of loans for six months up to two lakh. It is available to young entrepreneurs under the age of 50.
The state government has also announced loan waivers and low-interest loan facilities as part of the package. The finance minister said that the rent from the shops and buildings owned by the state will be forgiven for the period of July to December 2021. Micro, Small, and Medium Enterprises have been given a building tax exemption in this period.
"It will be helpful for the small and medium entrepreneurs. We have asked the bankers to provide loans as the state government is giving interest subvention. Traders can avail the loan for a smaller interest percent," said the minister to the media.
This is the third financial package announced by the Kerala government to tackle the economic crisis caused by the pandemic.