: PSBs disburse loans to MSMEs worth Rs 8,320 cr under ECLGS #FinanceIndia #StockMarketNEWS PSBs disburse loans to MSMEs worth Rs 8,320 cr under ECLGS New Delhi, Jun 8 (KNN) Public Sector Banks (PSBs)

@StockMarketNEWS Thu 11 Jun, 2020

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PSBs disburse loans to MSMEs worth Rs 8,320 cr under ECLGS #FinanceIndia #StockMarketNEWS
PSBs disburse loans to MSMEs worth Rs 8,320 cr under ECLGS New Delhi, Jun 8 (KNN) Public Sector Banks (PSBs) have disbursed Rs 8,320 crore till June 5 under the Rs 3-lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) for the Micro Small and Medium Enterprises (MSME) sector, said Finance Ministry.

PSBs have sanctioned loans worth Rs 17,705. 64 crore under the 100 per cent ECLGS starting June 1.
"As of 5 June 2020, #PSBs have sanctioned loans worth Rs 17,705. 64 crore under the 100 per cent Emergency Credit Line Guarantee Scheme, out of which Rs 8320. 24 crore have been disbursed," Sitharaman tweeted on Sunday.

State Bank of India (SBI), the countrys largest lender has sanctioned Rs 11,701 crore, while disbursement was nearly half at Rs 6,084. 71 crore at the end of June 5.

It is followed by Punjab National Bank (PNB) with a sanction of Rs 1,295. 59, but disbursement was less than one-fifth at Rs 242. 92 crore.

On May 21, the cabinet had cleared Rs 3 lakh crore to MSME and interested MUDRA borrowers by way of Emergency Credit Line Guarantee Scheme (ECLGS).

Under the Scheme, 100% guarantee coverage to be provided by National Credit Guarantee Trustee Company Limited (NCGTC) for additional funding of up to Rs 3 lakh crore to eligible MSMEs and interested MUDRA. borrowers, in the form of a Guaranteed Emergency Credit Line (GECL) facility.
The government will provide a corpus of Rs 41,600 crore for the scheme over the current and coming three financial years.

The main objective of the Scheme is to provide an incentive to Member Lending Institutions (MLIs), i. e. , Banks, Financial Institutions (FIs) and Non-Banking Financial Companies (NBFCs) to increase access to, and enable availability of additional funding facility to MSME borrowers, in view of the economic distress caused by the COVID-19 crisis, by providing them 100 per cent guarantee for any losses suffered by them due to non-repayment of the GECL funding by borrowers, the government said.

The collateral free loans are for those with Rs 25 crore outstanding loan or Rs 100 crore turnover. The tenure of the loan will be 4-year and moratorium of 12 months, said Finance Minister Nirmala Sitharaman.

The Finance Minister also announced 100% credit guarantee cover to banks and Non-Banking Financial Corporation (NBFCs) on principal and interest which will benefit 45 lakh units.

Sitharaman further said that the government will create a Fund of Fund to infuse Rs 50,000 crore as equity for MSMEs which are viable businesses and need hand holding.

She also asserted that in order to provide stressed MSMEs with equity support; government will facilitate the provision of Rs. 20,000 crores as subordinate debt.