KFC to provide financial support to 100 startups this year

The Kerala Financial Corporation (KFC) has announced a major initiative to support at least 100 startups in the current year, reinforcing its commitment to fostering innovation and entrepreneurship in the state. Finance Minister K.N. Balagopal unveiled the plan, which is part of a broader strategy to energize Kerala’s startup ecosystem.

KFC has already disbursed ₹78.52 crore in loans to 61 startups. The corporation offers collateral-free loans up to ₹10 crore at an interest rate of 5.6%, with the State government subsidizing 3% of this rate, making it the scheme more accessible for entrepreneurs.

Speaking at the Startup Conclave organised by KFC, Balagopal also announced substantial enhancements to KFC’s loan offerings. The collateral-free loan limit for startups will rise from ₹10 crore to ₹15 crore, while the limit for scaling up startups will increase from ₹2 crore to ₹3 crore. These changes aim to provide further support to businesses at different stages of development.

This move builds on KFC’s earlier initiative, the ‘KFC Startup Kerala’ scheme, launched in early 2021. The scheme provided comprehensive funding support of nearly ₹10 crore, assisting startups from proof of concept through development, market entry, and scaling up. The State’s 2020-21 Budget had introduced measures to support startups by offering loans without collateral for those with secured work orders.

Kerala Startup Mission's data shows the state has seen its registered startups rise to 5,015, surpassing the previously stated 3,900 in 2021, during the launch of KFC Startup Scheme with a goal to add 2,500 more. According to the 2024 Global Startup Ecosystem Report (GSER), Kerala's startup ecosystem, valued at $1.7 billion by the end of 2023, grew five times faster than the global average during the period.

The funding initiatives collectively reflect Kerala’s robust support for its entrepreneurial ecosystem and its broader goal of developing economic growth through innovation.