KATHMANDU, Dec 27: The domestic small industries can take loans at a subsidized rate of up to six percent per annum with the government endorsing the ‘Industrial and Investment Promotion Funds Operation and Management Guidelines 2024.’
According to the Ministry of Industry, Commerce and Supplies (MoICS), with the approval of the working guidelines in place, the old laws related to the issue have been scrapped. Dhruba Ghimire, joint-secretary of the MoICS, said the new guidelines have targeted to facilitate operation of the small industries provided they meet the given criteria.
With the new guidelines into effect, the government has dismissed the existing guidelines on Women Entrepreneurship Development Fund 2012; Micro, Cottage and Small Industries Development Fund 2012 and Micro, Cottage and Small Entrepreneur Technology Transfer 2016.
Office of Cottage and Small Industries provides subsidies to 33...
The new rule talks about providing loans starting from Rs 300,000 to Rs 2.5 million at subsidized rate of six percent per annum at a maximum. “If the entrepreneurs do not have fixed assets to maintain as collateral, the operating projects can be kept as guarantee while banks issue loans.”
Micro enterprise, cottage and small industries, government declared sick industries, entrepreneurship programs run by the related associations and federations, and research agencies will be eligible to receive the subsidized loans under this category. Likewise, the fund will be keeping women-run enterprises in high priority for the credit program.
The concerned banks have been allowed to take service charges of up to 0.3 percent of the credit amount. Based on the status of recovery of the monthly installments of the issued credit, the banks have been given a service charge ceiling of two percent, according to the guidelines.
The guideline has categorized its schemes in five groups and 19 sub-groups. Under the micro, cottage and small industries category, the subsidized loans will be provided for procurement of raw materials, transport, packaging, labeling and branding, production, product diversification, storage and safety and SMEs development.
For the technology related industries, procurement of new technology products, technology-transfer, training and capacity building, and research and development will be among the criteria to get loans. Under industrial promotion, the package will be provided to awareness, research and investigation, protection and registration of intellectual property rights, organizing trade fair, industries information and data analysis and facilitation of market access and network development, among others.
Likewise, the scheme has targeted at renovating and reestablishing sick industries. In the fifth category, the scheme is targeted at the management and upgradation of industries operated by women.
