Delhi: Emergency Credit Line Guarantee Scheme (ECLGS) since its launch, has extended relief to over 1.15 crore Micro, Small and Medium Enterprises (MSMEs) and businesses. 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 per press release.
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% of the guarantees issued are for loans sanctioned to micro, small and medium enterprises. Government has been receiving demands from various Industry bodies and other stakeholders to extend the scheme to ensure continued support to eligible sectors/businesses.
With a view to supporting various businesses impacted by the second wave of the COVID 19 pandemic, it has been decided to extend the timeline of the Emergency Credit Line Guarantee Scheme (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. Further, the last date of disbursement under the scheme has also been extended to June 30, 2022.
The following modifications have been made in the scheme to enable support to businesses impacted by the second wave of COVID are: Existing borrowers under ECLGS 1.0 & 2.0 would be eligible for additional credit support of up to 10% 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 of credit support of up to 30% of their credit outstanding as of March 31, 2021. Businesses in sectors specified under ECLGS 3.0, who have previously not availed ECLGS, can avail credit support up to 40% 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 3, 2021 from February 29, 2020. Accordingly, borrowers who have availed assistance under ECLGS and whose credit outstanding as of 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 2019 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 revised operational guidelines in this regard are being issued separately by National Credit Guarantee Trustee Company Limited (NCGTC).
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