Aatmanirbhar 3.0: Govt extends emergency credit score line for sectors harassed by Covid | Financial system Information

Aatmanirbhar 3.0: Govt extends emergency credit line for sectors stressed by Covid

New Delhi: The Centre on Thursday revamped its Rs three lakh crore emergency credit score line assure scheme (ECLGS) launched for offering liquidity to the MSMEs through the Covid pandemic by extending its protection to entities in 26 harassed sectors recognized by Kamath Committee in its report not too long ago with the addition of the well being care sector.

Accordingly, the ECLGS has been prolonged until March 31, 2021 from its earlier sundown time of November 30.

Asserting the Atmanirbhar Bharat Abhiyan 3.0 stimulus package deal, Finance Minister Nirmala Sitharaman stated beneath ECLGS already Rs two lakh crore had been offered to the MSME sector and the steadiness Rs one lakh crore will likely be now be used to assist harassed sectors to revive companies affected by the pandemic.

The Kamath Committee fashioned by the RBI to make suggestions on the monetary parameters to be thought of for the one-time restructuring of loans impacted by the Covid-19 pandemic in its report in September recognized 26 sectors, together with hospitality and tourism, aviation, development, textile, auto elements, mining for the aim of recommending monetary parameters to be factored within the decision plan.

Sitharaman stated that these sectors might additionally now get 100 per cent assured collateral free extra credit score at capped rates of interest as is offered to different MSMEs offered credit score excellent is above Rs 50 crore and as much as Rs 500 crore as on February 29, 2020.

The ECLGS scheme in its first model was restricted to MSME models, enterprise enterprises, particular person loans for enterprise functions and MUDRA debtors. It prolonged extra credit score as much as 20 per cent of excellent loans as on February 29 for entities with excellent credit score as much as Rs 50 crore as on February 29 and annual turnover as much as Rs 250 crore.

Tenor of extra credit score beneath ECLGS 2.0 will now be 5 years, (as an alternative of 4 years earlier), together with a one 12 months moratorium on principal compensation.

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“ECLGS 2.0 to offer a lot wanted aid to harassed sectors by serving to entities maintain employment and meet liabilities. It’s going to additionally profit the MSME sector which offers items and providers to eligible entities,” a authorities assertion on the scheme stated.