Sanctions of banks over Rs 1.20 lakh crore loans to MSMEs under credit guarantee program, Auto News, ET Auto


The program is the largest fiscal component of the Aatmanirbhar Bharat Abhiyan package, a Rs 20 lakh crore, announced by Finance Minister Nirmala Sitharaman in May.

New Delhi: The Finance Ministry said on Friday that banks had sanctioned loans of around Rs120,099 crore under the Rs 3 crore Emergency Line of Credit Guarantee Program (ECLGS) for the MSME sector reeling from the economic slowdown caused by the COVID-19 pandemic.

However, disbursements under this stood at Rs 61,987.90 crore until Thursday, July 9, under 100 percent ECLGS for micro, small and medium enterprises (MSMEs).

The program is the largest fiscal component of the Aatmanirbhar Bharat Abhiyan package, a Rs 20 lakh crore, announced by Finance Minister Nirmala Sitharaman in May.

The latest ECGLS figures, released by the Ministry of Finance, include disbursements from 12 public sector banks (PSBs), 22 private sector banks, and 21 non-bank financial corporations (NBFCs).

“As of July 9, 2020, the total amount sanctioned under the 100% emergency credit lines guarantee program by #PSBs and private banks was Rs 1 20,099.37 crore, of which Rs 61 was 987.90 crore rupees have already been disbursed, ”the finance minister said. in a tweet.

Under the ECLGS, loan amounts sanctioned by the PSB have increased to Rs 68,145.40 crore, of which Rs 38,372.88 crore has been disbursed as of July 9, she said.

At the same time, private sector banks sanctioned Rs 51,953.97 crore and disbursed Rs 23,615.02 crore.

“Compared to July 4, 2020, there is an increase of Rs 5,596.79 crore in the cumulative amount of sanctioned loans and an increase of Rs 5,896.72 crore in the cumulative amount of disbursed loans, both by the #PSB and private sector banks combined as of July 9. 2020, ”Sitharaman said.

Market leader SBI sanctioned Rs 20,788 crore in loans and disbursed Rs 13,893 crore. It is followed by the Punjab National Bank, which sanctioned Rs 8,977 crore. However, its disbursements stood at Rs 2,975 crore as of July 9.

At the state level, Maharashtra’s business units obtained the highest cumulative sanction of Rs 7,035 crore from public sector banks, while disbursements stood at Rs 3,897 crore as of July 9.

It is followed by Tamil Nadu, with a total loan sanction of Rs 6,955 crore and disbursements of Rs 4,153 crore.

On May 21, Cabinet approved additional funding of up to Rs 3 lakh crore at a concessional rate of 9.25% through ECLGS for the MSME sector.

Under this program, 100% guarantee coverage will be provided by the National Credit Guarantee Trustee Company for additional funding of up to Rs 3 lakh crore to eligible MSMEs and interested borrowers from the Development Agency and micro-unit refinancing (MUDRA) in the form of an emergency line of credit guarantee (GECL).

To this end, a corpus of Rs 41,600 crore has been put in place by the government, spread over the current fiscal year and the next three fiscal years.

The scheme will be applicable to all loans sanctioned under the GECL facility during the period from the date of the scheme’s announcement to October 31 or until the amount of Rs 3 lakh crore is sanctioned under the GECL, whichever comes first.

All accounts of MSME borrowers with outstanding credit of up to Rs 25 crore as of February 29, which were less than or equal to 60 days past due on that date i.e. regular accounts, SMA-0 and SMA-1, and with an annual turnover of up to Rs 100 crore are eligible for GECL funding under the program.

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