Government extends emergency credit line guarantee program until June 30
The government extended the Emergency Credit Lines Guarantee Program (ECLGS) by three months and widened its scope to issue additional financing up to 40% of loans outstanding as of February 29, 2020, up from 20 % earlier.
The program, dubbed ECLGS 3.0, has been extended until June 30, or until 3 trillion rupees is disbursed, due to the lingering negative impact of the Covid-19 pandemic on some service sectors the finance ministry said in a statement. The unsecured loan guarantee program, announced as part of the Atmanirbhar Bharat program, would now also cover borrowers with total outstanding loans of up to Rs 500 crore, with delays of 60 days or less on February 29, against 30 days earlier.
The duration of loans granted under ECGLS 3.0 will be 6 years, including a moratorium period of 2 years. The loan term in the previous version, ECLGS 2.0, was five years with a 12-month moratorium on principal repayment.
“The changes introduced in the program, while encouraging MLIs (member credit institutions) to allow the availability of an additional financing facility for eligible beneficiaries, will greatly contribute to economic recovery, job protection and the creation of an environment conducive to employment. generation, ”the statement read.
The government has incurred an expenditure of 4,000 crore rupees to provide a guarantee on loans of 91.9 lakh amounting to 2.01 trillion rupees as of March 15th.