Credit and Finance for MSMEs: Minister of State for MSMEs Bhanu Pratap Singh Verma on Monday said 1.17 crore businesses including MSMEs have been provided with Rs 3.23 lakh crore loans under the Emergency Credit Line Guarantee Scheme (ECLGS) as of March 18, 2022. Sharing data from the National Credit Guarantee Trust Company (NCGTC), which operates ECLGS, in reply to a written question in Rajya Sabha, Verma said out of the total beneficiaries, 95 per cent or 1.12 crore were MSMEs. The amount sanctioned to MSMEs out of the total loan amount so far was Rs 2.16 lakh crore.
The sanctioned amount had increased from Rs 2.46 lakh crore as of February 28, 2021, as per data shared by the former MSME Minister Nitin Gadkari in Rajya Sabha last year. In terms of disbursements, Rs 2.36 lakh crore were disbursed to MSMEs, PTI reported on February 10, 2022, citing Finance Minister Nirmala Sitharaman as saying in her reply to the discussion on Budget 2022-23 in Lok Sabha.
The initial admissible limit under ECLGS, which was launched in May 2020, was Rs 3 lakh crore which was later enhanced to Rs 4.5 lakh crore. Sitharaman in the budget had increased the guarantee coverage by Rs 50,000 crore to Rs 5 lakh crore. The additional funds were earmarked exclusively for hospitality and related enterprises, said Verma. The scheme is currently valid till March 31, 2023.
Subscribe to TheSpuzz SME newsletter now: Your weekly dose of news, views, and updates from the world of micro, small, and medium enterprises
Apart from MSMEs, ECLGS borrowers included other business enterprises constituted as proprietorships, partnerships, registered companies, trusts and limited liability partnerships (LLPs); and individual businesses. The guarantee is provided by NCGTC to member lending institutions including banks and non-banking financial companies with respect to the credit given to borrowers on their loan outstanding as of February 29, 2020.
Meanwhile, a Parliamentary Standing Committee on Industry in its report on March 21 had recommended the government to extend the loan repayment period under ECLGS up to seven-eight years from the current three-four years to support MSMEs impacted by the second Covid wave.