THIRUVANANTHAPURAM: Kerala Financial Corporation (KFC), the state-run development financial institution, has reported its highest-ever net profit of Rs98.16 crore for the financial year ended March 31, 2025 — a 32.56 per cent jump over the previous year.
The record-breaking performance also saw the corporation’s loan portfolio cross the Rs8,000-crore mark for the first time.
The institution’s net worth rose to Rs1,328.83 crore, bolstered by continued capital infusion from the state government.
Over the past few years, the government has injected Rs920 crore into KFC, including Rs500 crore during the current administration’s term.
“This support has enabled KFC to offer loans to MSMEs at interest rates starting from just 5 per cent. The growth of KFC mirrors the broader progress in Kerala’s industrial sector,” Finance Minister KN Balagopal said.
Strong capital position
The infusion of Rs200 crore in fresh capital in FY25 helped strengthen KFC’s Capital Adequacy Ratio (CRAR), which now stands at 28.26 per cent — well above the RBI’s minimum requirement of 15 per cent for non-banking financial companies (NBFCs).
KFC sanctioned Rs4,002.57 crore in loans during the year, primarily targeting MSMEs, startups, and other key sectors. Disbursements totaled ₹3,918.40 crore, while loan recoveries came in at Rs3,980.76 crore.
Managing Director Dr Sriram Venkitaraman credited the institution’s strong asset quality — with net non-performing assets (NPAs) below 1% – to disciplined lending and robust monitoring practices.
“This record performance positions KFC as a key driver of Kerala’s industrial and entrepreneurial advancement. We remain committed to supporting MSMEs and startups in the state, driving sustainable growth and job creation,” he said.
Driving innovation
Under the Chief Minister’s Entrepreneurship Development Programme CMEDP), KFC disbursed Rs1,030.89 crore in loans to 3,028 MSMEs at a concessional 5 per cent interest rate. The initiative is estimated to have created around 81,634 direct and indirect employment opportunities.
Separately, under the Startup Kerala Scheme, 72 startups received collateral-free loans totaling Rs95.20 crore, promoting early-stage innovation across the state.
Roadmap ahead
KFC has set a target to expand its loan book to Rs10,000 crore by the end of the current financial year.
To achieve this, the corporation plans to diversify into new sectors, while continuing to focus on MSMEs, tourism, and startup financing.
“To enhance operational efficiency and deliver superior services, KFC will undergo a comprehensive digital transformation this year,” said Dr Venkitaraman. The effort will include modernising office infrastructure and equipping staff with advanced training.
