Govt releases concessional loans of Rs 170 million for start-up projects

Kathmandu / Aug 4: The government has provided around Rs 170 million in concessional loans to 165 start-up companies, following the procedures set in the previous fiscal year. This funding was allocated for the fiscal year 2023/24.

The government invited project proposals from start-up companies between mid-January and mid-February 2024. After reviewing the submissions, loans were granted to those that successfully completed the selection process under the Start-up Enterprise Credit Operation Work Procedure, 2023.

The Industrial Enterprise Development Institute (IEDI) confirmed that these concessional loans have already been disbursed in two installments, with some companies set to receive a third installment by mid-August. According to IEDI Information Officer Bishwa Nath Ghimire, the total amount disbursed is around Rs 170 million.

In the previous year, the government had allocated Rs 242.5 million for start-up loans. Of this, Rs 40 million was reserved for loan guarantee funds (LGFs), while the remaining Rs 194 million was made available as loans at an interest rate of three percent, with a repayment period of two years. All loans must be repaid within five years.

The government has also decided to continue providing start-up loans in the current fiscal year 2024/25. The Ministry of Industry, Commerce, and Supplies (MoICS) has drafted a new start-up loan operation procedure in line with the National Start-up Policy, 2024. This procedure has been forwarded to the Ministry of Finance for approval.

Information Officer Ghimire stated that once the new procedure is approved, the process of loan disbursement will proceed within the current fiscal year. The new procedure stipulates that eligible start-up companies must be less than 10 years old and have an annual turnover not exceeding Rs 150 million. The process for obtaining and repaying these loans will be outlined in the procedure.