This Saturday, Government launched a brand-new scheme for the three lakh crore guaranteed loan programme which will make credits easily available, cheaper to set up oxygen plant generators on-site in hospitals to fight the coronavirus.
Civil aviation Companies will also get benefitted and expand the scope further by clicking the Credit Line Guarantee Scheme (ECLGS), which was struggling during the pandemic.
Finance Minister stated, ECLGS validity has expanded by 3 months through 30th September and Rs 3 lakh crore are issued as a guarantee for one month.
After the loan of Rs 2.46 lakh crore was sanctioned, no further demands have been made since then.
The government will provide a full guarantee on loans up to Rs 2 crore to medical departments for setting up an oxygen plant.
More flexibilities are established in loan repayment. As per RBI, the loan can be repaid in five years, with the first two years of interest followed by principal and residual interest in three years.
Moreover, an extra ECLGS for 10% outstanding as of February 29, 2020, will assist the borrowers covered under the older version scheme.
The ECLGS assistance up to 40% off id Rs. 200 crores, where the outstanding loan is eradicated.
Motivations are expected to create utility and impact enhancement with additional support to MSMEs, safeguard their livelihoods, and helping in a seamless resumption of business activity. Further, these changes will facilitate the flow of Institutional credit reasonably, FM added.
ECLGS 3.0 has a loan repayment expansion until six years, and a moratorium period is included. Initially, this scheme was meant to broaden the scope periodically which will enable a higher pool of benefits for businesses and professionals.