top of page
Resitential Flats

Emergency Credit Line Guarantee Scheme (ECLGS)

ECLGS Policy

Name of the Scheme

The Scheme named as Emergency Credit Line Guarantee Scheme (ECLGS)

Purpose of the Scheme

The Government of India has launched Emergency Credit Line Guarantee Scheme (ECLGS) for Medium, Small, and Micro Enterprises (MSMEs) under the Atma Nirbhar Bharat Abhiyan to help them tide over the economic distress being faced due to the COVID-19 pandemic for Rs. 3 Lakh Crore. The additional funding is offered for the working capital facility to resume business and safeguard jobs

Eligible Borrowers

All Business Enterprises /MSME borrower accounts with combined outstanding loans across all the
Lenders of up to Rs. 25 Crore as on 29.02.2020, and annual turnover of up to Rs. 100 Crore for FY
2019-20 are eligible for the Scheme.

Business Enterprises / MSMEs constituted as Proprietorship, Partnership, registered company, trusts
and Limited Liability Partnerships (LLPs) shall be eligible under the Scheme.

For loans having co-applicant, only those existing loans where entity is the primary co-applicant are
covered under the Scheme for additional emergency funding.

Loans provided in individual capacity are not covered under the Scheme.

Borrower accounts should be less than or equal to 60 days past due as on 29.02.2020 in order to be
eligible under the Scheme. i.e. All borrowers which have not been classified as SMA 2 or NPA by any
of the Lenders as on 29.02.2020 will be eligible for the Scheme

Business Enterprises / MSME borrower must be GST registered in all cases where such registration is
mandatory. This condition will not apply to Business Enterprises / MSMEs that are not required to
obtain GST registration.

Eligible Business Enterprises / MSME borrowers have ‘opt-out’ option for the facility.

Credit facility offered

Working capital term loan, the financial assistance provided as part of the scheme is to be operated as a separate loan account.

Loan amount

The amount of ECLGS funding additional working capital term loan facility would be up to 20% of
total outstanding, maximum up to Rs.5 Crore, subject to the borrower meeting all the eligibility criteria
and credit evaluation and assessment of the Bank.

Total Outstanding amount would comprise of the on-balance sheet exposure such as outstanding
amount across WC loans, term loans and WCTL loans. Off-balance sheet and non-fund based
exposures will be excluded.

In case a borrower has existing limits with multiple lenders, the scheme may be availed either through
the Bank or multiple lenders depending upon the agreement between the borrower and the Bank.

In case the borrower wishes to take from any lender an amount more than the proportional 20% of
the outstanding credit that the borrower has with that particular lender, a No Objection Certificate
(NOC) would be required from all other lenders.


The additional WCTL facility granted under ECLGS shall rank second charge with the existing credit
facilities in terms of cash flows and security, with charge on the assets financed under the Scheme

No additional credit facility can be granted on the security covered under the ECLGS scheme without permission of NCGTC

No additional collateral is required for additional funding under Scheme

Interest Rate of Credit under the Scheme

Lending rate shall be applicable as per interest rate on advance policy of the Bank and govern by the
ECLGS guideline rolled out from time to time, Interest rate shall be reviewed on monthly basis and
reset shall be done on quarterly basis subject to a maximum of 9.25% per annum

No additional processing Fee

No Guarantee Fee shall be charged for the Credit facilities provided under the Scheme

No pre-payment penalty


The Scheme would apply to all loans sanctioned under ECLGS Scheme up to 31.10.2020, or till an amount of scheme of Rs 3,00,000 crore is sanctioned by all MLIs, whichever is earlier.

Nature of account and Tenor of Credit under the Scheme

A separate loan account shall be opened

The tenor of loans provided under the scheme shall be for a tenor of four years from the date of

Moratorium period of one year on the principal amount and during which interest shall be payable

The principal shall be repaid in 36 installments along with applicable interest after the moratorium
period is over.

Definition of Default

The definition of default for borrowers shall be as per the instructions and guidelines issued by the Reserve Bank of India from time to time under extant norms on income recognition, asset classification, and provisioning.

Modifications in the Scheme

All norms of ECLGS shall be governed by the operational guideline issued and modification from time to time by National Credit Guarantee Trustee Company Limited (NCGTC) Any changes to the current structure of the Scheme, including but not limited to the eligibility criteria, guarantee fee, rate of interest and tenor of ECLGS under the Scheme, shall be can be modified from time to time

bottom of page