India Crypto Exchange

Best Bitcoin Trading Platform

Government widens scope of ECLGS, extends scheme deadline till March

Government widens scope of ECLGS, extends scheme deadline till March

The Finance Ministry on Wednesday expanded the scope of the Rs 4.5 lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) to support micro, small and medium enterprises facing liquidity issues due to the COVID-19 pandemic.

The validity of the scheme has been extended by another six months till March 31, 2022, the ministry said in a statement.

The government has been receiving demands from various industry bodies and other stakeholders to extend the scheme to ensure continued support to eligible sectors/businesses, it added.

“With a view to support various businesses impacted by the second wave of COVID 19 pandemic, it has been decided to extend the timeline of ECLGS till March 31, 2022, or till guarantees for an amount of Rs 4.5 lakh crore are issued under the scheme, whichever is earlier,” the ministry said.

Further, it said, the last date of disbursement under the scheme has also been extended to June 30, 2022.

The modifications have been made in the scheme to enable support to businesses impacted by the second wave of COVID, it said, adding existing borrowers under ECLGS 1.0 and 2.0 would be eligible for additional credit support of up to 10 per cent of total credit outstanding as of February 29, 2020, or March 31, 2021, whichever is higher.

Businesses who have not availed assistance under ECLGS (ECLGS 1.0 or 2.0), can avail credit support of up to 30 per cent of their credit outstanding as of March 31, 2021, it said.

Businesses in sectors specified under ECLGS 3.0, who have previously not availed ECLGS, can avail credit support of up to 40 per cent of their credit outstanding as of March 31, 2021, to the maximum of Rs 200 crore per borrower.

Incremental credit can be availed within these limits by existing ECLGS borrowers whose eligibility increased because of a change in cut-off date to March 31, 2021, from February 29, 2020.

Accordingly, “borrowers who have availed assistance under ECLGS and whose credit outstanding as on March 31, 2021, (excluding support under ECLGS) is higher than that on February 29, 2020, shall be eligible for incremental support within the cap stipulated under ECLGS 1.0, 2.0 or 3.0.

“The modification introduced would ensure that businesses adversely impacted by the second wave of COVID-19 get enhanced collateral-free liquidity. Further, this provides much-needed support to all the ECLGS borrowers (which mainly consist of MSME units) in time for the busy / festival season,” the ministry said.

The scheme since its launch in May last year has extended relief to over 1.15 crore MSMEs and businesses, it said, adding it has provided support to eligible borrowers in meeting their operational liabilities and restarting their businesses in the wake of disruptions caused by the COVID-19 pandemic.

As of September 24, 2021, loans sanctioned have crossed Rs 2.86 lakh crore under the scheme and out of total guarantees issued, about 95 per cent of the guarantees issued are for loans sanctioned to MSMEs.

The Finance Ministry in May expanded the scope of the Rs 3 lakh crore ECLGS by including concessional loans to hospitals for setting up on-site oxygen generation plants. Besides, the validity of the scheme was extended by three months to September 30 and or till the amount was disbursed.

The interest rate on these loans has been capped at 7.5 per cent, which means the banks can offer loans less than this ceiling.

0 0 votes
Notify of
0 评论
Inline Feedbacks
View all comments