![](https://www.nextias.com/ca/wp-content/uploads/2023/07/7114526Screenshot_6.png)
In News
- Recently, the Union Cabinet has approved the enhancement in the limit of the Emergency Credit Line Guarantee Scheme (ECLGS).
About
- The limit is enhanced from Rs. 4.5 Lakh crore to Rs. 5 Lakh crore.
- The additional amount is being earmarked exclusively for enterprises in hospitality and related sectors till validity of the scheme which is 31.03.2023.
- The increase has been done on account of the severe disruptions caused by COVID-19 pandemic on hospitality and related enterprises.
- Impact of limit enhancement:
- It will provide much needed relief to enterprises and support the recovery of hospitality sectors.
- Incentivizing lending institutions with additional credit of up to Rs. 50,000 crore at low cost.
- Enabling these business enterprises to meet their operational liabilities and continue their businesses.
About Emergency Credit Line Guarantee Scheme (ECLGS)
- Announced as part of the Atma Nirbhar Bharat Package in 2020
- Objective: to help businesses including MSMEs to meet their operational liabilities and resume businesses in view of the distress caused by the COVID-19 crisis.
- Providing Member Lending Institutions (MLIs), 100 percent guarantee against any losses suffered by them due to non-repayment of the ECLGS funding by borrowers.
- Operational domain of the Department of Financial Services (DFS), Ministry of Finance.
- Limit:
- The overall ceiling initially announced for ECLGS was Rs 3 lakh crore which was subsequently enhanced to Rs 4.5 lakh crore.
- Loans of about Rs. 3.67 Lakh crore have been sanctioned under ECLGS till 5.8.2022.
Source: PIB
Previous article
Cooperative Federalism
Next article
Megalodon