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60 percent ECLGS of revised Rs. 4.5 lakh crore plan ceiling was sanctioned & distributed to MSMEs

The Emergency Credit Line Guarantee Scheme (ECLGS), which was launched in May 2020 as part of the Atmanirbhar Bharat campaign to alleviate the liquidity issue of Covid-affected current MSME borrowers, has facilitated the sanctioning of 60.6 percent of the scheme ceiling of Rs 4.5 lakh crore. As of July 2, 2021, Rs 2.73 lakh crore in loans has been sanctioned, with partner banks and NBFCs disbursing Rs 2.14 lakh crore.

Furthermore, according to the Department of Financial Services, guarantees have already been given for loans disbursed to about 1.09 crore MSMEs. The information was provided by Narayan Tatu Rane, the new MSME Minister, in a written reply to a query in the Rajya Sabha on Monday. The government stated last month that the entire limit of acceptable guarantees will be increased by Rs 1.5 lakh crore from Rs 3 lakh crore at the time of the scheme's inception last year to Rs 4.5 lakh crore. Based on different industry recommendations, ECLGS has already been updated four times to broaden its reach and assist MSMEs and other borrowers. For example, as of February 29, 2020, MSME units, business enterprises, Mudra borrowers, and individual loans for business purposes with loan outstandings up to Rs 50 crore and days past due up to 60 days were eligible under ECLGS 1.0. Under ECLGS 2.0, the scope was expanded to include borrowers from the 26 challenged industries listed by the Kamath Committee, as well as the healthcare sector and have a debt outstanding in excess of Rs 50 crore and up to Rs 500 crore, as of February 29, 2020, and days past due in excess of 60 days. The programme has been extended numerous times, beginning in October of last year and ending in November of this year, followed by March 2021, June 2021, and now until September 2021, or until guarantees for the amount are provided under the plan's fourth version, termed ECLGS 4.0. On June 28, 2021, the minister said that the government has distributed Rs 2.69 lakh crore to 1.1 crore units through 12 public sector banks, 25 private sector banks, and 31 non-banking financial firms.


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