New Delhi: Union finance minister Nirmala Sitharaman, in her Budget 2022 speech, announced the extension of Emergency Credit Line Guarantee Scheme (ECLGS) till March 2023. Presenting her fourth Budget, Ms Sitharaman said the cover of the scheme will be expanded by Rs 50,000 crore to Rs 5 lakh crore.
An additional amount has been earmarked exclusively for hospitality, related sectors and the government will take steps to make the MSME (Micro, Small and Medium Enterprises) sector more resilient, she added.
The government had launched the scheme in view of the Covid-19 pandemic to provide credit facilities to business enterprises, small and medium businesses (MSMEs).
In September last year, the Centre had expanded the funds allotted under ECLGS from Rs 3 lakh crore initially to Rs 4.5 lakh crore and also extended the scheme until March 2022.
The scheme provides 100 per cent guarantee coverage for additional working capital term loans up to 20 per cent of the outstanding credit.
Only those MSME borrowers with outstanding loans of up to Rs 50 crore as of February 29, 2020 and turnover of up to Rs 250 crore for FY 2019-20, were eligible.
Further, the Finance Minister underlined that the country is expected to grow at 9.2 per cent in the current financial year, on the back of a sharp rebound in the economy.