Thiruvananthapuram, Jun 27 (IANS): The Kerala Financial Corporation (KFC), a leading Kerala government-owned financial institution, has raised the upper loan limit under the CM's Entrepreneurship Development Programme to Rs two crore and the micro, small and medium enterprises (MSME) in the state will get loans at five per cent interest.

The Kerala government will provide a subsidy of three per cent with KFC chipping in with two per cent to make the interest rate five per cent.

The KFC has so far assisted 2,122 units under the scheme and the target is to lend to 2,500 enterprises in five years at the rate of 500 enterprises every year, for which the Corporation has set aside Rs 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 non-resident Keralites is fixed at 55 years.

Loans are available for starting new ventures and modernising the 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 Rs two 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 only.

KFC also declared business campaign with 50 per cent waiver in processing fee for new MSME loans and 0.25 per cent interest discount for top rated clients as part of International MSME day celebrations.