Thiruvananthapuram: KSFE customers who have defaulted on loan repayments are set to receive significant relief under a special ‘Arrears Settlement 2026’ scheme aimed at helping borrowers clear outstanding dues through a one-time settlement mechanism.
According to a KSFE circular dated September 3, 2026, the special arrears settlement scheme will begin on September 7, 2026, with its benefits available until the end of November 2026.
One-Time Settlement Opportunity
The initiative has been designed to provide relief to borrowers struggling with overdue loan repayments. Eligible customers will get an opportunity to settle their outstanding loan liabilities under the special scheme, subject to the applicable KSFE terms and conditions.
Relief for Recovery Cases
A major feature of the scheme is that borrowers whose accounts have already entered the recovery process may also be eligible for benefits under the arrears settlement programme.
Up to 60% Interest Concession
The scheme provides for an interest concession of up to 60 percent, depending on the nature of the loan, outstanding arrears and applicable conditions. The concession could offer substantial financial relief to customers facing mounting repayment burdens.
The initiative is expected to benefit a large number of KSFE borrowers seeking to regularise their overdue accounts. Customers are advised to contact their respective KSFE branches for detailed information regarding eligibility, settlement procedures and the exact benefits available in their individual cases.
The scheme comes as an important financial relief measure for borrowers during the tenure of the government led by Chief Minister V.D. Satheesan.
