So as to assist Covid-hit MSMEs additional, the federal government on Sunday introduced a three-month extension of its Rs 3 lakh crore Emergency Credit score Line Assure Scheme (ECLGS) to September 30, 2021, from June 30, 2021, or until ensures for an quantity of Rs 3 lakh crore are issued underneath the fourth revision of the scheme dubbed ECLGS 4.0. The Ministry of Finance additionally introduced a 100 per cent assure cowl to loans as much as Rs 2 crore to hospitals, nursing houses, clinics, medical schools for establishing on-site oxygen technology crops with the rate of interest capped at 7.5 per cent.
The ministry additionally introduced the extension of the tenor of the scheme for MSMEs and different entities which are eligible for restructuring as per the Reserve Financial institution of India (RBI) tips as of Could 5, 2021, and had borrowed credit score underneath ECLGS 1.0. From general tenure of 4 years comprising of compensation of curiosity solely through the first 12 months with compensation of principal and curiosity in 36 months underneath ECLGS 1.0 will now be capable of avail for a tenor of 5 years for his or her ECLGS mortgage, that’s, compensation of curiosity just for the primary 24 months with compensation of principal and curiosity in 36 months thereafter.
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Furthermore, extra ECLGS help of as much as 10 per cent of the excellent credit score as of February 29, 2020, has been provided to debtors lined underneath ECLGS 1.0 in step with restructuring as per RBI tips. “Further ECLGS help of as much as 10 per cent of the excellent to the debtors will allow them to beat the current monetary issues. It could be extra applicable if SME I labeled models have been allowed to avail these advantages. We had additionally requested computerized renewals of all statutory approvals for the working companies with out prices for the present 12 months. The federal government in addition to banks want to take a look at this case with compassion. We hope state governments may even reply the best way central authorities and RBI have responded,” Manguirish Pai Raiker, Chairman, Nationwide Council for MSME, Assocham advised Monetary Specific On-line.
The federal government has additionally eliminated the present restrict of Rs 500 crore mortgage excellent for eligibility underneath ECLGS 3.0 topic to most extra ECLGS help to every borrower being restricted to 40 per cent or Rs 200 crore, whichever is decrease, the ministry stated on Sunday. The Ministry additionally prolonged the scope of ECLGS 3.0 to cowl the Civil Aviation sector.