Revision of Interest Rate under Base Rate Regime wef. 01.07.2021

1. The Corporation has revised the interest rates for the loans under the Base Rate Regime as follows.

  • The revised interest rate shall be applicable from 01.07.2021 to all standard accounts. The benefit shall be passed to all such customers wef. 01.07.2021, irrespective of their reset date automatically through the software. No separate request from the customers is required.
  • Where additional interest rates have been charged due to the fair value based Valuation Policy (1.5% to 4.5%)/ Restructuring done as a part of COVID-19 relief as per the RBI approved packages (up to 1.5%), such additional interest rates charged, if any, shall be reversed and the additional interest so charged shall be credited in the concerned loan accounts.
  • For loans sanctioned/ disbursed from 01.10.2020 to 15.06.2021, the interest rates charged shall be at the rates prevailing on 01.09.2020. The excess interests charged (on accounts of reasons mentioned in Para (b) above), if any, shall be credited in the running loan accounts. The ACR norms to be considered for all such cases shall be as per the policy prevailing on 01.09.2020. From 01.07.2021, the new interest rates shall be applicable.
  • The last date for availing rebate for prompt repayment shall be extended up to 10th of every month up to September 2021 for all loans.
  • Wherever there is a hike in interest rate, the revised interest rate shall be made applicable to such units, from their next reset date.
  • The revised demand effective from 01.07.2021 will be reflected in the demand notice for the month of Jul 2021.
  • The interest rates are linked to the Credit Rating of the unit. Customers who are not rated during last FY are requested to submit the copy of the audited balance sheet for FY 2019-20 to the concerned Branch Office to avail the benefits of interest rate reduction.

Revision of Interest Rates of the Corporation wef.01.07.2021

  • The Interest Rate Structure is as follows:
    Base Rate: 8%

Sl No

Credit Rating

Gold Card &
Band 1


Band 2

≥65% and < 75%

Band 3

≥55% and < 65%

Band 4

≥45% and <55%

Effective rate after rebate*


MSME units

Hospitality (Classified Hotel without Bar/ Classified Resort without Bar/ Unclassified Hotels having a minimum of 10 Rooms/ Homestays (classified by Tourism Dept – GoK or Ministry of Tourism, GOI)

Health Care sector (Hospital/ clinic/ etc.)






Hotels/ Resorts with Bar#, Unclassified Hotels having  less than  10 Rooms, Auditorium, Convention Centre, Lodge, Hostel, Kalyanamandapam, Godown, Warehouse, Quarry/ Metal Crushing units, Contractor loan (WEF & EFF)






Flat/ Apartment/ Villa/ Shopping Complex/ Mall/ Multiplex/ Cinema Theater/ Film/ Serial





*The rate mentioned in the above table is the net effective interest rate after rebate. Rebate for prompt repayment (0.5%) for all BR linked loans, except for Special Schemes/ Facilities as specified in the scheme.

# Applicable if the Hotel/ Resort is having bar income, i.e. Income from liquor sale, (Present/ Projected) more than 25% of the total turnover. If a Hotel/ Resort is having bar income, i.e. Income from liquor sale, (Present/ Projected) less than or equal to 25% of the total turnover, the interest rate applicable for such hotel/ resort shall be as specified in Para 1 (a) above.

The rate of interest over the base rate (i.e. Spread in the interest rate), in the above table, shall be the Credit Risk Premium of sector/ Band.

2. Additional Business Strategy Premium (ABSP) of 0.50% to be charged in following cases:

  • Working Capital Loans
  • Short Term Loans
  • Units with CIBIL MSME Rank (CMR)/ CIBIL Emerging Corporate Rank (CER): 6 to 10

However, the ABSP of 0.50% (as mentioned in (a) to (c) above) need not be charged to an entity for multiple parameters and the total ABSP for an entity in such cases shall be limited to 0.50%.

3. The gross interest rate for LoC Facilities (other than those linked to Rating of the Units) will be as follows:

EBDS (without security)    -        12.50% (with 0.50% rebate)
EBDS (with security)                  -        11.50% (with 0.50% rebate)
GBDS                             -        10.50% (without rebate)

4. The rate of interest, for unrated units and cases for which the rating falls below 45% at the time of re-rating, shall be the interest rate in the band 4 of the concerned category plus 1%.

5. The rate of interest for Special Schemes (where interest rates are not linked to Rating of the unit) shall be as follows:

Scheme Name

Gross Interest Rate

Scheme for Funding Defibering Units

BR + 2.50% (with 0.50% Rebate).

COVID Relief Schemes (old schemes)

BR + 2.0% (with 0.50% Rebate).

COVID-19 Relief Loan Scheme for Existing Customers of KFC

BR + 2.0% (with 0.50% Rebate).

COVID-19 Relief Loan Scheme 2.0 for Existing Customers of KFC in MSME, Healthcare and Hospitality Sector

BR + 2.0% (with 0.50% Rebate).

KFC Assistance to MSMEs in Healthcare to fight COVID-19 (new scheme)

Loans up to and including Rs.50 lakh will be covered under CMEDP at net interest rate of 7% pa, after 3% Govt subsidy.

For loans above Rs.50 lakh, there shall be two separate loan accounts. Loan portion up to and including Rs.50 lakh (first loan account) shall have a net interest rate of 7%, after 3% Govt subsidy. The interest rate for the balance portion (second loan account) shall be based on the Credit Rating of the unit as per the Interest Rate Policy.

Venture Debt Scheme/ Purchase Orders Scheme (old Scheme)

BR + 3.0% (with 0.50% Rebate). The interest rate is inclusive of the amount to cover the guarantee commission.


BR + 2% (without rebate). 3% subsidy as per CMEDP Manual

Special Loan Schemes for Start-ups (as per Circular No. KFC/CIR28/CR     14/2020-21 dated 07.08.2020)

BR +1% (without rebate).0.60% additional interest (Corpus fee) will be charged for coverage under ‘Start-up Guarantee Funds’.2% subsidy as per the Circular.

Special Loan Scheme for funding conversion of diesel-powered buses to CNG or LNG powered buses

BR + 2.5% (with 0.50% rebate). 

Special Working Capital Assistance Scheme (with security)

For new customers, the interest rate shall be as per the rating of the unit plus 0.50% ABSP.
For existing customers, prevailing rate of term loan plus 0.50% ABSP, subject to minimum of gross interest of 10% pa (with rebate 0.50%) shall be charged. No separate credit rating required in such cases.

Special Working Capital Assistance Scheme (without security)

For new customers, the Gross interest rate shall be 10.50% pa (including 0.50% ABSP) with a rebate of 0.50%, irrespective of rating of the unit.
For existing customers, prevailing rate of term loan plus 0.50% ABSP, subject to minimum Gross interest rate of 10.50% pa (with 0.50%rebate), shall be charged.

6. Additional Interest.

            (a) Additional Interest (AI) to be charged in the following circumstances:




AI for Non-compliance of conditions (for the non-compliance period)

Where promoters fail to comply with sanction conditions or Non-submission of documents as stipulated, AI rate for such period shall be charged, till the time conditions are complied/ documents are submitted.


Commitment Charges (for the unutilized portion of the loan)

Commitment charges will be levied in case of non-utilization/ underutilization of Fund based credit facilities at specific rate for the unutilized portion.


AI for Advance Disbursement (Till the time advance is regularized)

When advance disbursement is done/ Disbursement is done relaxing Promoter Contribution, AI shall be charged, till the time such advance is regularized.


AI for Rescheduled accounts (for the specific period*)

When the account is rescheduled at the specific request of the promoter, AI for the specific period shall be charged. However, this AI shall not be applicable where reschedule is extended as a part of general package.


Penal Interest

Penal charges for the defaulted amount for the defaulted period.


7. KFC Gold Card Customer.  Customers of the Corporation who have completed three years of association based on disbursement of loan and having an excellent track record will be recognized by providing them with KFC Gold Card, renewable on an annual basis, if they satisfy the following criteria.

  • Internal credit rating is above 70%.  
  • All accounts including group concerns are in standard category throughout.
  • Unit is in commercial operation and functioning well.
  • Has submitted the audited balance sheets, has positive net worth and no statutory dues pending.
  • Latest CIBIL scores of the promoters and the entity are 650 or above.

8. The PLR of the Corporation shall continue at 14.50%. The customers who switch over to base rate shall be eligible for the applicable interest rate as per the Credit Rating of the concerned category and Band.