KSIDC - Term Loan
The KSIDC Term Loan Scheme is a long-term finance facility implemented by the Kerala State Industrial Development Corporation (KSIDC) under the Government of Kerala. The scheme is designed to provide long-term financial support for establishing new units as well as for expansion, modernisation, and plant modification of existing enterprises. It supports eligible business entities with structured repayment, moratorium benefits, and competitive interest rates. The scheme is currently active and applicable across Kerala.
Key Features
- Project-based term loan for capital investment: Finance is provided for approved project components such as land, building, plant & machinery, and other fixed assets. The loan is meant for capital expenditure and not for routine trading or working capital activities.
- Available for new and existing industrial units: Both new entrepreneurs and existing MSMEs in Kerala can apply for setting up new units, expansion, diversification, or modernization projects, subject to project viability.
- Medium to long-term tenure with moratorium: Repayment is structured based on projected cash flows, with a moratorium period during the implementation stage so that repayment starts after commercial operations begin.
- Promoter contribution mandatory: Promoters are required to bring in a prescribed margin (generally 25–40% of project cost), ensuring financial commitment towards the project.
- Comprehensive appraisal before sanction: Each proposal undergoes detailed technical and financial evaluation to assess feasibility, market potential, and repayment capacity before approval.
- Security-backed loan structure: The term loan is secured through mortgage/hypothecation of assets and personal or corporate guarantees as per KSIDC norms.
- Disbursement linked to project progress: Funds are released in stages based on project implementation milestones and verification of asset creation.
- Interest rate as per prevailing KSIDC policy: The applicable interest rate is decided as per KSIDC’s lending norms and mentioned in the sanction terms, and may be revised as per policy.
Financial Assistance
Eligibility Criteria
Who can apply:
- Partnership Firms
- Limited Liability Partnerships (LLPs)
- Private Limited Companies
- Public Limited Companies
- Units seeking finance for establishment, expansion, modernisation, or plant modification
Who cannot apply:
- Proprietorship concerns
- Trading-only businesses
- Activities not approved by KSIDC
- Proposals not meeting financial or technical viability norms
Documents Required
- Company incorporation and constitutional documents
- Detailed project report (DPR)
- Cost of project and means of finance
- Financial statements and cash flow projections
- KYC documents of promoters/directors
- Asset details for security creation
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: Capital-intensive projects requiring structured support.
Option 2: Apply Directly through KSIDC
- Submit project proposal and financials to KSIDC
- KSIDC conducts technical and financial appraisal
- Credit rating and sanction based on internal mechanisms
- Execution of loan and security documents
- Disbursement as per sanctioned terms and milestones
Power combo with the scheme
Related Schemes
Frequently asked questions
What is the purpose of the KSIDC Term Loan?
The term loan supports long-term capital requirements for establishment, expansion, modernization, and plant modification. It helps enterprises fund fixed assets and infrastructure with structured repayment aligned to business cash flows.
Who is eligible to apply for the term loan?
Partnership firms, LLPs, private limited companies, and public limited companies operating in Kerala can apply, subject to KSIDC’s appraisal norms and project viability assessment.
What is the loan amount available under this scheme?
KSIDC offers term loans ranging from ₹100 lakh to ₹6,000 lakh, depending on project cost, financial strength, and internal credit rating assessment.
What are the repayment and moratorium terms?
Repayment tenure ranges from 6 to 10 years, with a moratorium of 1 to 2 years, fixed based on project cash flows and sanction conditions.
What interest rate is applicable to the term loan?
The interest rate ranges from 8.50% to 10.50% (floating) and is determined by KSIDC’s internal credit rating mechanism. An additional 0.5% rebate is available for prompt repayment.
What security is required for availing the term loan?
The loan is secured by an exclusive or pari passu charge over the assets financed under the scheme, along with other security requirements specified by KSIDC.