Rs 3 lakh cr ECLGS: Nearly 33% of amount disbursed so far; this many MSME loan accounts credited

Credit and Finance for MSMEs: Of the Rs 3-lakh-crore committed by the government for Covid-hit MSMEs under the Emergency Credit Line Guarantee Scheme (ECLGS) in May this year, 32.8 per cent (Rs 98.665.93 crore) has been disbursed in 22,77,463 MSME loan accounts, as of August 12, according to the government data. A total of 12 public sector banks with a share of 55.4 per cent (Rs 54,677.11 crore) and 24 private banks and 31 non-banking financial companies (NBFCs) with the remaining share of 44.5 per cent (Rs 43,988.82 crore) had made disbursements out of the sanctioned amount of Rs 1,43,318.09 crore. Moreover, out of the 22.77 lakh MSMEs, which received credit as of August 12, 19,84,310 MSMEs have been disbursed by public lenders while the rest 2,93,153 small businesses were given credit by private sector banks and NBFCs, according to the data tweeted by the Finance Minister Nirmala Sitharaman’s office.

The ECLGS scheme was part of the Rs 3.7 lakh crore package for MSMEs under the Rs 20 lakh crore economic stimulus announced by PM Modi. According to the scheme, 45 lakh units will be able to benefit from resuming business activity and safeguarding jobs for employees. The government had earlier this month also expanded the scope of the scheme and eligibility criteria to benefit individual entrepreneurs and more number of MSMEs. The government had raised the upper ceiling of loan outstanding, as on 29 February 2020, from earlier up to Rs 25 crore to Rs 50 crore now. As per the guidelines, small businesses can seek credit up to 20 per cent of their outstanding amount. However, now borrowers can get credit up to Rs 10 crore, which is 20 per cent of Rs 50 crore, up from Rs 5 crore – 20 per cent of earlier Rs 25 crore.

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State Bank of India remained the biggest lender disbursing over Rs 16.5k crore followed by nearly Rs 7k crore disbursed by Punjab National Bank, Rs 6.5k crore disbursed by Canara Bank, Rs 5.7k crore by Bank of Baroda, Rs 4.8k crore by Union Bank of India, etc. However, in terms of the number of MSMEs supported, Canara Bank led the tally with over 3.75 lakh MSME loan accounts disbursed credit. Other top lenders were State Bank of India supporting nearly 3 lakh MSMEs, over 2.07 lakh MSMEs disbursed by Union Bank of India, close to 2.02 MSMEs raising credit from Bank and India, etc.

The government had also enhanced the annual turnover limit from Rs 100 crore to Rs 250 crore “in line with the increased ceiling of loans outstanding, and the revised definition of MSMEs issued by the Ministry of MSME,” National Credit Guarantee Trustee Company (NCGTC) had said in a notification to the heads of all scheduled commercial banks, financial institutions, and NBFCs.