NEW DELHI: Despite so much government pressure to extend credit to small industries, so far Rs 2.82 lakh crore has been sanctioned under the Emergency Line of Credit Guarantee Program (ECLGS).
“As reported by the DFS, on November 19, 2021, Rs 2.82 lakh crore were sanctioned under this program,” MSME Minister Narayan Rane told Lok Sabha on Thursday in a written response.
Finance Minister Nirmala Sitharaman announced the program as a Covid relief measure for small industries last year, allocating Rs 3 lakh crore for the program, in addition to the Rs 1.5 lakh crore announced in June of this year, as part of the Covid relief program for the second wave.
However, the disbursement has been slow. The government has relaxed the criteria for loan disbursements.
For example, existing borrowers under ECLGS 1.0 and 2.0 would be eligible for additional credit support of up to 10% of the total credit outstanding as of 02/29/2020 or 03/31/2021, whichever is greater.
He also indicated that companies that have not benefited from aid under the ECLGS (ECLGS 1.0 or 2.0) can benefit from credit support of up to 30% of their outstanding credit as of 03.31.2021. and in some sectors up to 40%.
He also announced an extension of the program until March 31, 2022, as more than Rs 1.5 lakh crore remain unused.
The program disbursement deadline has been extended to June 30, 2022. ECGLS reports to the Ministry of Finance, Financial Services Department (DFS).