Home > Digital Ecosystem > II. Mentorship > Enlightener Series > CMEDP-II Loans

Status: Active

Classification: Public Sector Scheme

Release Date(s):
1st April 2023
19th January 2021

Offering: Loan/Credit

Entity Type: Public Sector Bank

Reading Time: 7 Mins

Ticket Size: ₹5 Lakhs to ₹2 Crores

Entity Name: Kerala Financial Corporation

#Views: 57

Disclaimer….before you read ahead!
The information contained herein is of a general nature and for information purposes only, with the intent of raising awareness around various resources, schemes etc. available for women entrepreneurs in India. It is not intended to address the circumstances of any particular individual or entity. It does not purport to be all-inclusive or necessarily contain all the information that may be relevant for the reader, and may be subject to updation, revision or amendment. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to remain accurate in the future. The reader, therefore, is required to exercise their discretion; and not act on such information without appropriate professional advice after a thorough examination of the particular situation.

Furthermore, we are not a lender and are not authorized by the Reserve Bank of India to act as one. By disseminating the information contained herein, we are not soliciting any borrower or customers for the company or organization mentioned herein nor do we intend to syndicate any capital for the reader of this email.


About this scheme…

CMEDP-II Loans is an extension of Chief Minister’s Entrepreneurship Development Programme (CMEDP) launched by Government of Kerala in July 2020 to address the issues of shortage of working capital and availability of credit faced by startups and MSMEs in Kerala. This scheme is being implemented by Kerala Financial Corporation (KFC).

Headquartered in Thiruvananthapuram, KFC – a Kerala Government owned development financial institution incorporated under State Financial Corporations Act of 1951 – operates through 16 branch offices in Kerala including 3 zonal offices at Ernakulum, Kozhikode, and Kollam.

Special preference is given to women entrepreneurs and persons with disabilities.


How is it being implemented?

Under CMEDP-II Loans Scheme, direct financial assistance in the form of loans is given to new or existing

  • MSMEs
  • Startups registered with Kerala Start Mission (KSUM)
  • Units registered under NORKA Department Project for Return Emigrants (NDPREN) Scheme and referred by Non-Resident Keralites Affairs (NORKA) Roots
  • Agro-based projects


What’s on offer?

I. Product

  • Term loans
  • Ticket size:
    • ₹5 Lakhs to ₹2 Crores (earlier it was upto ₹1 Crore) sanctioned at subsidized rates of interest as mentioned below
    • KFC may entertain ticket sizes higher than ₹2 Crores, in case of large projects, under this Scheme wherein balance loan (in excess of ₹2 Crores) would be made available at KFC’s normal interest rates

II. Purpose:

  • To start new ventures or modernize the existing ventures
    • Acquisition of fixed assets
    • Working capital requirements

III. Borrower Type:

  • Sole Proprietorship, Unincorporated Associations, Partnerships Firm, Limited Liability Partnership (LLP), Private Limited Company
  • For information on whether Limited Company, Co-operative Society, Trust, Corporation can also apply, please contact KFC via means mentioned below

IV. Security or collateral or Guarantee or Insurance

  • Primary Security: First charge on assets created out of the credit facility so extended
    • Benchmark Asset Coverage Ratio (ACR) required – 1:1
  • Collateral: Seems to be nil for loans upto ₹2 Crores
    • If there is a requirement to provide collateral security, do check with KFC on possibility & extent of coverage of such loans under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE)
  • For more information around primary security, collateral, guarantee and insurance, please contact KFC via means mentioned below

V. Interest Rate

  • Subsidized at 5% per annum (earlier it was 7%)
    • Government of Kerala will provide 3% subsidy and a further 2% subsidy will be provided by KFC
  • For Startups, interest rate would be 5.6% per annum
  • Such subsidized interest rates can be availed for the first 5 years of the loan tenure post which KFC’s normal interest rate (prevalent at that time) will become applicable
  • Also, in case of large projects where ticket sizes sanctioned are higher than ₹2 Crores, balance loan (in excess of ₹2 Crores) would be made available at KFC’s normal interest rates which could go upto 11.5% per annum

VI. Processing Fee

  • For information on processing fee, please contact KFC via the means mentioned below

VII. Margin Money Requirement

  • 10%

VIII. Tenure, Repayments & Pre-Closures

  • Tenure: upto 10 years
    • Interest subsidy as described above will be for the first 5 years only
  • For information on repayments, pre-closures, please contact KFC via means mentioned below

IX. Turnaround Time

  • Process of availing CMEDP-II Loans comprises of the following:
    • Online enquiry submission
    • Document submission
    • Branch verification and/or Online Interview
    • Training – KFC will provide specialized training and follow-up services to selected entrepreneurs
    • Sanction & disbursement
  • For information on turnaround time, please contact KFC via the means mentioned below


Interested? Read ahead to check your eligibility….

I. Is your business registered as an MSME/Udyam?


Is your MSME unit new or has commenced commercial operations within the last 18 months?


Is your startup registered with KSUM and has not completed 10 years from the date of incorporation or registration?


Is your unit registered under NDPREN Scheme and referred by NORKA Roots?


Is your project agro-based i.e. related to floriculture, tissue culture, fish culture, poultry farming, breeding & hatching etc.?

III. Does your business activity fall into category other than bar hotels, transport, crusher, trading, CRE projects, contractor, or cinema or serial production?


In case you are a women entrepreneur, SC/ST entrepreneur or non-resident Keralite; and the chief promoter of your business, is your age below 55 years?


In case your unit is referred by NORKA Roots, is the age of the chief promoter of your business below 60 years?


In all other cases, is the age of the chief promoter of your business below 50 years?

V. Is none of the promoter(s) of your business permanently employed elsewhere?

VI. Is the CIBIL score of each of the promoter(s) more than 650?

If your answers to the questions above are an emphatic YES, you are all set to avail CMEDP-II Loans!


So…how big is this scheme and what has been done so far?

I. Under this Scheme, KFC is committed deploy ₹500 Crores across 500 enterprises every year

II. Target is to help 2,500 enterprises in 5 years under this Scheme

III. Since launch in July 2020 and as of March 31, 2022:

  • CMEDP-I: ₹55 Crores has been sanctioned to 1,878 units of which, ₹28 Crores has been disbursed to 1,620 units
  • CMEDP-II: ₹113 Crores has been sanctioned to 224 units of which, ₹40 Crores has been disbursed


So, now, how should you go about it?

I. To kick start the process with online enquiry & application submission, follow this link and click on “Apply Online” OR select CMEDP Loans and click in “Apply Online”

II. For information on:

III. For any queries, please contact KFC:

  • Via phone on +91 471 2737500 or toll free 1800 425 8590





Go on then…and do spread the word!



  1. About the Scheme 1: Click here and select CMEDP Loans
  2. About the Scheme 2
  3. About Launch of Original Scheme
  4. About Original Scheme
  5. About First Revamping of Original Scheme
  6. About Second & Latest Revamping of Original Scheme
  7. Information on Security Requirements
  8. KFC Annual Report 2021-22
  9. KFC Annual Report 2020-21

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