Emergency Credit Line Guarantee Scheme (ECLGS): Principal to be paid in 48 installments post 1-yr moratorium

With the Centre extending the Emergency Credit Line Guarantee Scheme (ECLGS) to 26 sectors, borrowers under the extended programme - ECLGS 2.0 -- will have to repay the principal amount in 48 installments after the one-year moratorium.

On Thursday, the National Credit Guarantee Trustee Company Ltd (NCGTC) issued the operational guidelines in this regard.

"The principal shall be repaid in 36 installments under ECLGS 1.0 and in 48 instalments under ECLGS 2.0 after the moratorium period is over," the guidelines said.

Moratorium period of one year on the principal amount shall be provided to borrowers for the fund-based portion of GECL (guarantee emergency credit line) credit during which interest shall be payable.

The government has extended the ECLGS, through ECLGS 2.0, for the 26 sectors identified by the K.V. Kamath Committee and the healthcare sector.

Under ECLGS 2.0, entities with outstanding credit above Rs 50 crore and not exceeding Rs 500 crore as on February 29 this year, which were less than or equal to 30 days past due as on February 29, are eligible.

These borrower accounts shall be eligible for additional funding up to 20 per cent, which could be fund based or non-fund based or both, of their total outstanding credit as a collateral-free GECL, which would be fully guaranteed by the NCGTC.

The loans provided under ECLGS 2.0 will have a 5-year tenor, with a 12-month moratorium on repayment of principal.

In addition to ECLGS 2.0, where no annual turnover ceiling has been prescribed, it has also been decided to extend ECLGS 1.0 to entities under ECLGS, which had a total credit outstanding (fund-based only) of up to Rs 50 crore as on February 29, but were previously ineligible owing to their annual turnover exceeding Rs 250 crore.

All other existing criteria or terms and conditions remain unchanged, said a Finance Ministry statement.

The scheme would be applicable to all loans sanctioned under ECLGS during the period from the date of issue of these guidelines by NCGTC to March 31, 2021 or till guarantees for an amount of Rs 3 lakh crore is sanctioned under the ECLGS, taking into account both ECLGS 1.0 and 2.0, whichever is earlier.
 

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