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Centre extends MSME loan guarantee scheme by 1 month
The government on Monday extended the Emergency Credit Line Guarantee Scheme (ECLGS) for MSMEs by one month till November 30, as the scheme has so far failed to meet the target of Rs 3 lakh crore.
The scheme was valid till October-end. It was launched as part of the Aatmanirbhar Bharat Abhiyan package announced by Finance Minister Nirmala Sitharaman in May to mitigate the distress caused by coronavirus-induced lockdown, by providing credit to different sectors, especially micro, small and medium enterprises (MSMEs).
The scheme has been extended till November 30 or till such time that an amount of Rs 3 lakh crore is sanctioned under the scheme, whichever is earlier, the Finance Ministry said in a statement said. The step has been taken in view of the opening up of various sectors in the economy and the expected increase in demand during the ongoing festive season. “This extension will provide a further opportunity to such borrowers who have not availed of the scheme so far, to obtain credit under the scheme,” it said.
According to data uploaded by member lending institutions on the ECLGS portal, an amount of Rs 2.03 lakh crore has been sanctioned under the scheme to 60.67 lakh borrowers so far, while an amount of Rs 1.48 lakh crore has been disbursed. Under the scheme, fully guaranteed and collateral-free additional credit to MSMEs, business enterprises, individual loans for business purposes, and MUDRA borrowers is provided to the extent of 20 per cent of their credit outstanding as on February 29, 2020. Borrowers with a credit outstanding up to Rs 50 crore as on February 29, and with an annual turnover of up to Rs 250 crore are eligible under the scheme.