Bengal govt cuts interest on loan by 0.30% for FY 2025-26; Institutions, state-supported bodies to benefit

The West Bengal government has announced a significant financial decision to reduce the interest rates on loans and advances for the financial year 2025–26. According to the official notification from the Finance Department, the new interest rate has been fixed at 7.22% per annum. This marks a decrease of 0.30% compared to the 7.52% interest rate applicable during the previous fiscal year (2024–25). The move is aimed at easing the financial burden on various state-supported bodies and encouraging developmental activities across the state.

This revised interest rate will apply to a wide range of categories, including industrial and commercial undertakings in the public and cooperative sectors. These organizations can avail themselves of investment loans, working capital loans, and loans intended to meet cash losses under the newly stipulated terms. By lowering the cost of borrowing, the state government intends to provide a much-needed liquidity boost to public sector units that are critical to West Bengal's economic infrastructure.

Local bodies such as Municipal Corporations, Municipalities, Improvement Trusts, and Development Authorities are also major beneficiaries of this decision. Additionally, Zilla Parishads, Panchayat Samitis, and Housing Boards can now access state-funded loans at the reduced rate of 7.22%. This is expected to accelerate urban and rural development projects, as these bodies will now have access to cheaper capital for public utility and infrastructure works.

Furthermore, the new policy covers loans to various Cooperative Societies, excluding those specifically financed by national agencies like NABARD or NCDC. Other miscellaneous loans sanctioned by the state will also fall under this new interest regime. The state government believes that this fiscal adjustment will streamline financial management for local governance and cooperative sectors, ultimately fostering a more robust economic environment for the upcoming financial year.