The scope of the Emergency Credit Line Guarantee Scheme (ECLGS) was further expanded by the finance ministry on Sunday. This was done keeping in mind the economic disruptions caused by the second wave of the COVID-19 pandemic.

Highlights of ECLGS 4.0

  • Loans of up to Rs 2 crore with a 100% guarantee cover will be extended to the hospitals, clinics, nursing homes and medical colleges for setting up of on-site generation plants to generate oxygen. The interest rate for this loan has been capped at 7.5%.
  • MSMEs and the other entities which are eligible for restructuring as per the guidelines of the Reserve Bank of India (RBI) issued on 5th May, 2021 and had credit borrowed under the ECLGS 1.0 have been given a tenor extension under ECLGS 4.0. From overall tenure of four years given under the ECLGS 1.0, borrowers will now be able to avail for a tenor of five years which means for the first 24 months (2 years) only interest repaid and with the repayment of interest and principal in 36 months (3 years).
  • Additional ECLGS assistance has been offered to the borrowers who have been covered under ECLGS 1.0, of up to 10 % of their outstanding credit as on 29th February, 2020.
  • The Finance Ministry has announced the removal of the current Rs 500 crore outstanding loans limit for eligibility under the ECLGS 3.0. Additional ECLGS assistance to each borrower has been limited to 40% or Rs 200 crore, whichever is lower.
  • ECLGS 3.0 scope has been extended to cover the Civil Aviation sector as announced by the Finance Ministry.

Time period of the scheme

The scheme has been extended from 30th June 2021 to 30th September 2021.

About Ministry of Finance

Minister: Nirmala Sitharaman

Minister of State: Anurag Thakur


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