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Wednesday, December 2, 2020

Kerala Government Announces Schemes to Support It’s Ailing Tourism Industry

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Thiruvananthapuram, 18th August 2020:  Department of Tourism, Government of Kerala, has launched two schemes aimed to provide immediate relief to businesses and employees of the tourism industry within the state.

Relief for Businesses: In order to provide relief to tourism businesses, Government of Kerala along with, Kerala State Level Bankers’ Committee (SLBC) has approved a soft loan facility to make available a working capital facility in the tourism sector such as Hotels, Resorts, Ayurveda Centres, Homestays, Serviced Villas, House Boats, Tour Operators (Accredited with Department of Tourism, Government of Kerala / India Tourism), Transport Operators accredited with India Tourism, etc who are affected by the detrimental effect of COVID-19 pandemic.

Key highlights of the scheme:

  • Tourism industry stakeholders can apply for a working capital loan of up to Rs.25 lakhs from the banks, at a rate of interest as per the approved policy of respective banks
  • There will be a repayment holiday for the first 6 months
  • The repayment of the loan to be made in 42 months, including the 6 months repayment holiday
  • 50% of the interest on the loan for the first 12 months will be absorbed by the Department of Tourism, Government of Kerala
  • The Interest subvention will be limited to a maximum of 4.50%
  • A single entity with multiple outlets will be eligible to a higher amount of loan depending category of business they fall under.

Relief for Employees:  In order to provide them a relief to the employees of the tourism industry, Government of Kerala along with Kerala Bank has approved a soft loan facility for employees working in establishments engaged in the tourism sector such as Hotels, Resorts, Ayurveda Centres, Homestays, Serviced Villas, House Boats, Tour Operators (Accredited with Department of Tourism, Government of Kerala / India Tourism), Transport Operators accredited with India Tourism, Tourist Motor Boat Operators (having a valid license from the Port Department), etc who are affected by the detrimental effect of COVID-19 pandemic.

Key highlights of the scheme:

  • This scheme allows loan of up to Rs.30,000 per employee
  • The Loan will be given at an interest rate of 9% p.a. Of which, the Government will absorb 6% for the total period of 18 months, and the borrower would only need to pay interest of 3% per annum.
  • There will be a 4 months moratorium period
  • Repayment to be done in 18 months including the 4 months moratorium

Kerala Tourism has been a significant contributor to the economy of Kerala for decades with a revenue of Rs 45,019 crores to the sector in 2019 and providing employment to 1.5 million people. The state received more than 1.19 million foreign tourists and 18.4 million domestic tourists last year with an impressive annual growth of 8.52% and 17.81% respectively. It is estimated that the tourism industry in the state has already lost Rs 20,000 crores due to the COVID-19 Pandemic.

These support schemes by Kerala that are being highly appreciated by the tourism industry,  also pave a way for other states governments to follow the example and start supporting their local tourism industry.

Anyone who wishes to avail the benefits of the above schemes can submit a formal application by visiting: https://www.keralatourism.org/

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