Interest Subsidy Scheme for Scheduled Caste/Scheduled Tribe Entrepreneurs
in Karnataka
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Interest Subsidy Scheme for Scheduled Caste/Scheduled Tribe Entrepreneurs in Karnataka
Interest Subsidy Scheme for Scheduled Caste/Scheduled Tribe Entrepreneurs is a government scheme available to eligible residents of Karnataka.
Apply for Interest Subsidy Scheme for Scheduled Caste/Scheduled Tribe Entrepreneurs in Karnataka
Scheme Overview
The scheme aims to encourage SC/ST entrepreneurs to establish micro or small-scale service enterprises & to expand, diversify, or modernize their existing units. Under this scheme, a loan amount ranging from a min. of ₹20.00 lakhs to a max. of ₹1,000.00 lakhs is provided at an interest rate of 4%.
Eligibility Criteria
The unit shall be fully owned by SC / ST entrepreneurs i.e., all promoters in proprietary / partnership / company shall belong to SC/ST community only.
The ownership / share holdings of units even in part by other than SC/STs are not eligible for interest subsidy.
Entrepreneurs either can be SCs / STs or both.
**Others terms & conditions:**
The units which have availed the interest subsidy under any other scheme of Government of Karnataka/Government of India are not eligible for interest subsidy under this scheme.
To be eligible for interest concession under the scheme, the units should not be in default in repayment to KSFC.
KSFC is at liberty to consider any amount of project cost. However, the interest subsidy is restricted to ₹1,000.00 lakhs of the loan. Interest amount on the balance loan amount beyond ₹1,000.00 lakhs is required to be borne by the entrepreneurs.
KSFC may sanction loans with normal applicable rate of interest, the effective interest rate to be paid by the beneficiary / borrower will be 4%. The difference between the normal lending rate of KSFC and effective interest rate of 4% will be reimbursed by Government of Karnataka.
Benefits
**Loan Amount:**
Minimum loan amount under the scheme is ₹20.00 lakhs.
Maximum loan amount under the scheme is ₹1,000.00 lakhs which includes term loan and one time working capital term loan based on the project proposal but working capital term loan is restricted to maximum of ₹50.00 lakhs. However, repetition of working capital term loan sanction is not allowed.
The loan can be availed for establishing new units or expanding / diversifying / modernizing their existing units for more than one occasion, but the aggregate loan extended shall not be more than maximum limit under the scheme.
**Rate of Interest:**
The effective rate of interest is 4% only.
**Repayment Period:**
The repayment period is 8 years including moratorium period in case of loan upto ₹500.00 lakhs and upto 10 years in case of loan above ₹500.00 lakhs but below ₹1,000.00 lakhs.
Required Documents
| # | Document |
|---|---|
| 1 | Passport-size Photograph |
| 2 | Proof of SC/ST status of the entrepreneurs |
| 3 | Bio-Data Net Worth Statement |
| 4 | Affidavit (Affidavit-SC-ST.pdf) |
| 5 | Audited financial statements (if expanding an existing unit) |
| 6 | Bank account details for loan disbursement |
| 7 | Any other documents as specified by KSFC during the loan process |
Common questions in Karnataka
Who can apply for Interest Subsidy Scheme for Scheduled Caste/Scheduled Tribe Entrepreneurs in Karnataka?
Eligible residents of Karnataka who meet the scheme’s overall criteria can apply for Interest Subsidy Scheme for Scheduled Caste/Scheduled Tribe Entrepreneurs. Refer to the eligibility section above for the complete checklist.
What documents are required for Interest Subsidy Scheme for Scheduled Caste/Scheduled Tribe Entrepreneurs in Karnataka?
Applicants in Karnataka typically need identity proof (Aadhaar), state residency proof, bank account details, and any scheme-specific documents listed in the documents section.
Frequently Asked Questions
It is a scheme introduced by the Government of Karnataka to provide interest subsidies on loans for SC/ST entrepreneurs through KSFC.