The central government has extended the Emergency Credit Line Guarantee Scheme (ECLGS) till March 31, 2022, to support businesses impacted by the pandemic.
Responding to the demands from various industry bodies and other stakeholders, the government has extended the timeline of ECLGS till March 31, 2022, or till guarantees for an amount of Rs 4.5 lakh trillion are issued under the scheme, whichever is earlier, to ensure that businesses adversely impacted by the second wave of Covid-19 get enhanced collateral free liquidity. Further, the last date of disbursement under the scheme has also been extended to June 30, 2022.
Since its launch, ECLGS has extended relief to over 11.5 million 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 on September 24, 2021, loans sanctioned have crossed Rs 2.86 trillion under the scheme, and about 95% of the total guarantees issued are for loans sanctioned to MSMEs.
Existing borrowers under ECLGS 1.0 and 2.0 will be eligible for additional credit support of up to 10% of total credit outstanding as on February 29, 2020, or March 31, 2021, whichever is higher. 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 on March 31, 2021, to the maximum of Rs 2 billion per borrower.