Emergency Credit Line Guarantee Scheme (ECLGS)

The ECLGS 1.0 and 2.0 schemes were rolled out by the Government as a specific response to the unprecedented situation COVID-19. It seeks to provide much needed relief to the MSME sector by incentivizing MLIs to provide additional credit of up to Rs. 3 lakh crore at low cost, thereby enabling MSMEs to meet their operational liabilities and restart their smooth functioning of their businesses.

HDFC Bank is registered under the trust to provide these schemes to their customers.

The ECLGS 1.0 and 2.0 schemes which were introduced till 31stMar’21, have been extended till 30th June’21 for sanctions and till 30th Sep’21 for the release of funds. 

Additionally, new scheme under ECLGS 3.0 has been introduced for specific sectors which are Hospitality, Travel & Tourism and Leisure & Sporting sectors. 

Hence customers can avail the benefit of all the three schemes ( ECLGS 1.0 , 2.0 and 3.0 ) till 30th Jun’21. 

ECLGS-1.0 refers to providing additional 20% of the eligible credit facility extended to eligible borrowers on the total credit outstanding (fund based only) across all lending institutions upto Rs.50 crores (upto 60 days past due) as on February 29, 2020 for a tenor of four years from the date of first disbursement with a moratorium period of one year on the principal amount. 

ECLGS-2.0 refers to providing additional 20% of eligible credit facility extended to the eligible borrowers in the 26 sectors identified by the Kamath Committee on Resolution Framework and the Healthcare sector on the total credit outstanding (fund and/or non based) across all lending institutions greater than Rs.50 crore and not exceeding Rs.500 crore (upto 60 days past due) as on February 29, 2020 for a tenor of five years from the date of first disbursement with a moratorium period of one year on the principal amount. 

ECLGS 3.0 refers to providing scheme for providing 40% (in case of Hospitality, Travel & Tourism and Leisure & Sporting sectors) of the eligible credit facility extended to eligible borrowers on the total credit outstanding (fund based only) across all lending institutions upto Rs.500 crores (upto 60 days past due) as on February 29, 2020 for a tenor of six years from the date of first disbursement with a moratorium period of two years on the principal amount. Borrowers who have already availed 20% under ECLGS 1.0 or 2.0, will be eligible for assistance for remaining 20% only under ECLGS 3.0 

Interest Rate on GECL shall be capped as Bank external benchmark lending rate +1%

No processing fees, pre-payment penalty and guarantee fees shall be charged by MLIs to borrowers for the above schemes. 

The security will rank second charge with the existing credit facilities in terms of cash flows (including repayments) and security, with charge on the assets financed under the Scheme to be created on or before September 30, 2021 or date of NPA, whichever is earlier. 

For additional information on the same, please contact your Relationship Manager 

For detailed guidelines and FAQs and to access ECLGS site for please click on the link :-   https://www.eclgs.com