Kerala Entrepreneur Loan Scheme (KELS)
The Kerala Entrepreneur Loan Scheme (KELS) is a credit support scheme implemented by the Directorate of Industries and Commerce, Government of Kerala. The scheme was launched to improve access to institutional finance for new and existing entrepreneurs, especially first-time MSMEs. KELS provides bank loans with interest subsidy support, helping entrepreneurs start or expand enterprises while reducing borrowing costs. The scheme is ongoing and applicable across Kerala.
Key Features
- Bank Loans Routed Through Scheduled Banks: Under KELS, eligible entrepreneurs must avail term loan or working capital loan from recognised banks. The loan is sanctioned and disbursed entirely as per bank norms, with no direct lending by the government.
- Fixed Interest Subsidy by Government of Kerala: The Government reimburses a fixed percentage of the interest paid by the entrepreneur on the bank loan. This subsidy is released after loan disbursement based on certified interest details from the bank.
- Subsidy Limited to a Defined Period: Interest subsidy under KELS is available only for a specified number of years from the date of loan disbursement. After this period, the entrepreneur continues repayment at normal bank interest rates.
- Applicable to Both New and Existing MSMEs: The scheme covers first-time entrepreneurs starting a new unit as well as existing MSMEs that take fresh loans for expansion or diversification.
- Subsidy Administered Through DICs: District Industries Centres verify eligibility, process subsidy claims, and release the interest subsidy after scrutiny of bank documents and compliance.
Financial Assistance
Eligibility Criteria
Who can apply:
- Entrepreneurs establishing MSMEs in Kerala
- Existing MSMEs undertaking expansion
- Units registered under Udyam
- Manufacturing and service sector enterprises
- Loans availed from recognised banks
Who cannot apply:
- Trading-only activities (where excluded)
- Units outside Kerala
- Enterprises with chronic loan defaults
- Activities not approved by the Industries Department
Documents Required
- UDYAM Registration Certificate
- Loan sanction letter from bank/financial institution
- Bank account details
- PAN, Aadhaar, and enterprise identity documents
- Project report or purpose of loan
- Interest repayment statements
- Undertaking as per scheme guidelines
Application process for the scheme
Option 1: Apply with Bullit (Recommended)
Start instantly with our guided application support, where our team verifies eligibility, prepares documentation, and coordinates with the Industries Department on your behalf. Using our business loans and compliance calendar, you can track progress while focusing on project execution, we manage the application end-to-end.
Recommended for: MSMEs seeking faster processing and error-free submission.
Option 2: Apply Through the Kerala Industries Department
- Avail an eligible loan from a scheduled bank or financial institution
- Approach the concerned District Industries Centre (DIC)
- Submit KELS application along with loan and enterprise details
- Application is verified by departmental authorities
- Interest subsidy is sanctioned and released as per scheme norms
Power combo with the scheme
Related Schemes
Frequently asked questions
What is the objective of the KELS scheme?
KELS aims to reduce the interest burden on MSMEs by providing government-backed interest subsidy on formal bank loans.
Is KELS a direct loan scheme?
No. KELS does not provide loans directly. It supports entrepreneurs by subsidizing interest on loans sanctioned by banks.
Can new enterprises apply under KELS?
Yes. Newly established MSMEs can apply, provided they meet registration and loan eligibility norms.
Does KELS cover working capital loans?
Yes. Interest subsidy may apply to eligible working capital loans as per scheme guidelines.
Is the scheme currently active?
Yes. KELS is an active Kerala Government MSME support scheme.
Can multiple loans be covered?
Coverage depends on scheme norms and ceilings specified in applicable government orders.