A sizable amount of loan sanctioned to MSMEs.Here's everything you need to know!
By Priti Kumari
NEW DELHI: Under the Emergency Credit Line Guarantee Scheme (ECLGS), banks have sanctioned INR 1.86 lakh crore to 50 lakh MSMEs.
Moving a step towards 'Atma Nirbhar Bharata ', GOI has announced an economic aid of INR20 LAKH crore (10% of GDP) in May this year to boost up MSMEs, Industries, etc.which got exacerbated due to the global pandemic. Out of this,3 lakh crore has been credited to the MSMEs with up to INR 25 crore outstanding loans and INR 100 crore business turnover. According to the Finance Ministry, as on September 29, more than 27 lakh MSMEs have been disbursed an amount of INR 1.32 lakh crore."As reported on 29,09.2020, by 12 Public Sectors Banks, top 24 Private Sector Banks &31 NBFCs, the total amount sanctioned to Non-Individual 7individuals, under the 100 % Emergency Credit Line Guarantee Scheme(ECLGS) stands at INR 1,86,469 crore, of which INR 1,32,246 crore has already been disbursed to 27,09,027 borrowers," FM sources said.
De facto, ECLGS is a part of the INR 20 lakh crore package announced by GOI in may. As per this, the entire funding provided under Guaranteed Emergency Credit Line( GECL) shall be provided with a100% credit guarantee coverage by (National Credit Guarantee Trustee Company )NCGTC. Under the Companies Act 1956, the NCGTC was incorporated on March 18, 2014. It is a wholly-owned company of GOI under the Finance Ministry. At present, there are 5 credit guarantee Trusts under NCGTC. For this resolution, the government had set up a corpus of INR 41,600 crore for 3 FY. To provide impetus to the same, the Union Government has passed some bills in this monsoon session of Parliament.
Besides, the NBFCs, HFCs & MFIs have also been credited with a Special Liquidity Scheme of INR 30,000 crore. Banks have also ratified the purchase of INR crore portfolio and INR 45,000 crore to Partial Credit Guarantee Scheme 2.0. Amid the economic volatility due to COVID-19, the government has also raised the upper limit for IBC defaulters from INR 1 lakh to INR 1crore.