In a bid to promote or boost an industry or businesses in certain sectors like textile or agriculture, etc the government can allow subsidy on the interest. This is known as interest subvention.
For instance, if a textile company borrows loan from a bank at 10% interest rate and the government provides subvention of 2% then the net interest the textiles company would have to shell out would be 8%.Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
