Kerala Interest Subvention Scheme for Nano Household Enterprises (up to 8%) — Frequently Asked Questions

It offers an interest subvention — a government contribution towards the interest a nano or household unit pays on its term loan. Instead of a one-time grant, the support is released on a reimbursement basis and runs for the first three years of the loan.

The rate is 6% per annum, and it rises to 8% per annum for enterprises led by women or belonging to SC/ST categories. Since the benefit is calculated on your own term loan, the rupee value differs from unit to unit — which is why the scheme is listed as offering a variable amount. Support is available for three years.

Your fixed capital investment must be ₹10 Lakhs or less, and the unit must be in manufacturing, services or job work. It also has to qualify as a white or green category unit under pollution control norms and have a connected load of 5 HP or less. Units on the negative list of industries, such as breweries, sawmills and metal crushers, are not eligible.

No. The scheme is always open and applications are accepted on a rolling basis, so there is no cut-off date to chase. Decisions are conveyed at the end of each quarter, which means applying earlier in a quarter can lead to an earlier answer. There is also no application fee.

No. This is a subsidy in the form of interest subvention, so it is non-dilutive — the government reimburses part of your interest cost and does not receive shares, ownership or a share of profits in return.

It is disbursed on a reimbursement basis against the term loan. For the second and third year, the subvention is granted only if the bank has not classified the loan as an NPA, so keeping repayments on track is what keeps the benefit flowing.

The conditions set out for this scheme focus on the investment ceiling, the nature of the activity, the pollution category and the connected load. DPIIT recognition or MSME registration is not listed among the stated eligibility conditions, so the deciding factors are the unit's size, activity and category.

The offline route requires the prescribed application form with all required documents attached. During scrutiny, the sanctioning authority may also ask you or your financial institution for further documentation or clarifications to verify the details you have provided, so keep your loan and unit records ready.

Both routes are available. Online, you go to the Directorate of Industries & Commerce portal at https://schemes.industry.kerala.gov.in/public/index.php/schemes, choose the Scheme for Interest Subvention to Nano Household Enterprises under Online Services and click Apply Now; new users register first, existing users log in, and then you select New Application, proceed and submit the completed form. Offline, you download the form given in Annexure-1 of the scheme guideline at https://old.industry.kerala.gov.in/images/pdf/Go3.pdf, fill it in, attach the required documents and submit it to the Assistant District Industries Officer (ADIO) of the concerned taluk office or the District Industries Centre (DIC).

The ADIO or DIC reviews it as the recommending and sanctioning authority, and may seek clarifications or extra documents from you or your bank. You are expected to give true information and allow inspection or verification of assets if asked. The outcome is then communicated to you directly or electronically at the end of each quarter.

Kerala Interest Subvention Scheme for Nano Household Enterprises (up to 8%) is offered by Directorate of Industries and Commerce, Government of Kerala, a government body. It is provided as non-dilutive funding.