Excellent news for MSMEs: Emergency Credit score Line Assure Scheme prolonged by one month | Economic system Information

Good news for MSMEs: Emergency Credit Line Guarantee Scheme extended by one month

New Delhi: In a bid to extend in demand in the course of the ongoing festive season the federal government has prolonged the Emergency Credit score Line Assure Scheme (ECLGS) by one month or until such time that an quantity of Rs 3 lakh crore is sanctioned underneath the Scheme (whichever is earlier).

“The Union Authorities has prolonged the Emergency Credit score Line Assure Scheme (ECLGS) by one month until November thirtieth, 2020, or until such time that an quantity of Rs. 3 lakh crore is sanctioned underneath the Scheme, whichever is earlier, in view of the opening up of varied sectors within the economic system and the anticipated enhance in demand in the course of the ongoing festive season. This extension will present an additional alternative to such debtors who haven’t availed of the Scheme up to now, to acquire credit score underneath the Scheme,” an official launch stated.

The ECLGS was introduced as a part of the Aatma Nirbhar Bharat Package deal (ANBP) to offer absolutely assured and collateral free further credit score to MSMEs, enterprise enterprises, particular person loans for enterprise functions and MUDRA debtors, to the extent of 20 per cent of their credit score excellent as on February 29, 2020.

Debtors with credit score excellent as much as Rs 50 crore as on February 29, 2020, and with an annual turnover of as much as Rs 250 crore are eligible underneath the Scheme.

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Rates of interest underneath the Scheme are capped at 9.25 per cent for Banks and FIs, and 14 per cent for NBFCs. Tenor of loans supplied underneath the Scheme is 4 years, together with a moratorium of 1 12 months on precept compensation.

As per information uploaded by Member Lending Establishments on the ECLGS portal, an quantity of Rs. 2.03 lakh crore has been sanctioned underneath the Scheme to 60.67 lakh debtors up to now, whereas an quantity of Rs. 1.48 lakh crore has been disbursed.