EHS Legal Update: Ministry of Finance issues the scope of Emergency Credit Line Guarantee Scheme
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The Ministry of Finance on May 30, 2021, has issued the scope of Emergency Credit Line Guarantee Scheme as the dispute caused by the second wave of COVID 19 pandemic to businesses across various sectors of the economy are as under: –
- ECLGS 4.0:100% guarantee cover to loans up to Rs.2 crore to hospitals/nursing homes/clinics/medical colleges for setting up on-site oxygen generation plants, interest rate capped at 7.5%.
- Borrowers who are eligible for restructuring as per RBI guidelines of May 05, 2021 and had availed loans under ECLGS 1.0 of overall tenure of four years comprising of repayment of interest only during the first 12 months with repayment of principal and interest in 36 months thereafter will now be able to avail a tenure of five years for their ECLGS loan.
- Additional ECLGS assistance of up to 10% of the outstanding as on February 29, 2020, to borrowers covered under ECLGS 1.0.
- Current ceiling of Rs. 500 Cr. of loan outstanding for eligibility under ECLGS 3.0 to be removed.
- Civil Aviation sector to be eligible under ECLGS 3.0.
- Validity of ECLGS extended to September 30, 2021, or till guarantees for an amount of Rs.3 lakh crore are issued. Disbursement under the scheme permitted up to December 31, 2021.
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