Kerala Financial Corp aims to double the size of its loan portfolio to 10,000 crore
State-owned Kerala Financial Corporation aims to double the size of its loan portfolio to 10,000 crore, according to state finance minister KN Balagopal, under whose jurisdiction the company falls.
Earlier this year, the Company set a target of 5,000 crore in the loan portfolio compared to ₹ 4,621.13 crore of the previous year (2020-2021). The proposed doubling is despite the negative feelings about businesses aroused by the Covid-19 pandemic.
Defy Covid-19 Concerns
Indeed, the Company was able to position itself well and was able to improve its performance in terms of record growth of the loan portfolio, higher penalties, disbursements and collections during the year. He also succeeded in drastically reducing NPAs, an official spokesperson said.
The Minister of Finance announced the increase in the target of the loan portfolio while speaking to entrepreneurs during the inaugural function of the second phase of the Chief Minister’s Entrepreneurship Development Program (CMEDP 2.0) set implemented by the Company.
“The state hopes to see Kerala Financial Corporation become a financial supermarket helping entrepreneurs with low interest rates and easy terms. To facilitate this, the state government will introduce new programs and broaden the horizons of its activities, ”said the Minister of Finance.
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Sanjay Kaul, chairman and chief executive, said digital lending and technology upgrading will be the central themes of the company in the years to come. The state government and the entrepreneurial community have always supported the Company in its efforts, he added.
Flock of applications
The state government announced CMEDP 2.0 on November 5 of this year, and the program has since seen an increase in requests. To date, more than 130 loans have been sanctioned. The Minister issued loan sanction letters to entrepreneurs under the CMEDP and Startup Kerala programs.
The first phase of the CMEDP system, which was deployed in July 2020, saw more than 1,700 loans sanctioned. In the second phase, the loan limit was increased to 1 crore from ₹ 50 lakh while the interest rate was reduced from seven percent to five percent.
Increased credit limit, reduced rates
The program funds up to 90 percent of the cost of the project, also in layman’s terms. The state government is proposing to help 2,500 businesses under this scheme. Meanwhile, Kerala Financial Corporation is also providing training and coaching for frontline entrepreneurs, the spokesperson said.
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The Company has a 68-year track record in the lending industry and has managed various government-sponsored programs over the years in addition to project finance, he added.