Annexure IA KERALA STATE ENTREPRENEUR DEVELOPMENT MISSION (KSEDM) General Instructions Eligibility Criteria Groups / Individuals who satisfy

the following criteria will be eligible for registration under the Mission: ! ! The promotion of the enterprise has to be done by a group, preferably five in number. However a smaller group (minimum 2) can be considered for a viable project. Technocrats can set up enterprises individually. For the Mission, a technocrat is defined as any one of the following: (a) Graduates in Engineering (b) Diploma Holders (three-year) in Engineering (c) Doctors in all streams of medicine, including veterinary doctors, for setting up enterprises in their fields of specialization (d) Chartered Accountants and Cost & Management Accountants (e) Post Graduates in Management (MBA) from reputed institutions ! ! The group must have identified an enterprise for setting up. To encourage regional and distributed development, the enterprise has to be set up in the local body where at least one of the promoters resides. However, considering the techno-economic feasibility aspects, the District-based selection committee is empowered to allow relaxations in this. The promoters have to establish viability of the project in all areas technical, infrastructural, commercial and financial. The promoters can set up enterprises in the premises owned by them or taken on lease/rent. The area must be adequate for the proposed activity. The promoter group has to be a very cohesive one and they should have formed / should form a partnership firm. All the promoters have to be first line entrepreneurs. All of them must be aged between 18 and 40 on the date of registration. In case of widows the upper age limit will be 45 years and enterprises promoted by widows will get preference for selection. All of them must have passed higher secondary course or successfully completed a vocational course approved by Government. All of them have to provide details as per Know Your Customer (KYC) norms. None of them must be members of any other group under the mission. None of them should be permanently employed elsewhere. None of them should have availed concessional finance under any other scheme of the central/state government. While applying for loans, the selected/trained candidates will have to comply with all conditions relating to appraisal and sanction and provide all documents necessary for appraisal. Sanction of loan will be subject to norms and conditions of the funding agency concerned.

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Eligible Activities ! ! ! New projects being set up under micro / small enterprises sector and eligible for registration with Directorate of Industries & Commerce. Good Agri-based projects like integrated dairy farms, poly-houses, etc. Trading, transport, farming and fishing are not eligible.

Financial Assistance ! ! ! ! The eligible maximum loan amount will be Rs 10 lakh per technocrat promoter and Rs 4 lakhs per non-technocrat promoter, subject to a maximum of Rs 20 lakhs per enterprise. Maximum repayment period is five years, including a maximum moratorium period of one year. Minimum promoters contribution is 10 percent. Will be provided by Banks / Financial Institutions and the choice of the funding agency is left to the promoter group.

The Financial Institution will be at liberty to recall the assistance in case of misuse or misutilisation. The financial assistance will be sanctioned after following due appraisal and sanction procedures based on the lending policies of the funding agency. Security a) Mortgage/hypothecation of land and all assets of the enterprise. b) Personal guarantee of all members. c) Additional security in the following manner. (i) Personal guarantee of two or more solvent sureties, outside the promoter group. The suretys liability will be apportioned / fixed according to their number. (OR) (ii) Coverage under CGTMSE. (OR) (iii) Collateral security, covering 25% of the Principal Amount sanctioned. Procedure ! ! ! ! ! Registration Forms are available in the KSEDM portal in the website of KFC www.kfc.org Registration Form has to be filled up on-line. Eligible groups will be called to appear before the District-based selection committee for scrutiny of their proposal and the entrepreneurial trends in the persons promoting it. Members of selected groups are to undergo two week training on entrepreneurship arranged specifically for Mission beneficiaries. After training the promoters have to submit applications for financial assistance in prescribed forms, format available in www.kfc.org, and submit them to the Branch of KFC for forwarding to the funding agency of the choice of the promoters. Interest at the Base Rate of the funding agency will be paid by the Government / Nodal Agency (KFC) on a monthly basis from funds provided by Government for the purpose based on the claim made by the funding agency along with copies of statement of accounts and sanction details. Interest will not be paid in the case of enterprises that default continuously and are declared as incapable for servicing the loan.