ECLGS was initially was announced as part of the Atma Nirbhar Bharat Package in 2020 to help businesses including MSMEs to meet their operational liabilities and resume businesses in view of the distress caused by the COVID-19 crisis.
- The scheme provides Member Lending Institutions (MLIs), 100 percent guarantee against any losses suffered by them due to non-repayment of the ECLGS funding by borrowers.
- The scheme is under the operational domain of the Department of Financial Services (DFS), Ministry of Finance.
- National Credit Guarantee Trustee Company Ltd (NCGTC) has been set up as a company to manage and provide guarantees to these loans.
Key Features of the ECLGS 5.0
- Aim: Provide credit guarantee coverage to MLIs by National Credit Guarantee Trustee Company Limited (NCGTC) for the amount in default under the additional credit facility extended to the eligible borrowers to tide over any short-term liquidity mismatches in view of West Asia Crisis.
- Eligible borrowers:MSMEs and non-MSMEs with existing working capital limits and scheduled passenger airlines having outstanding credit facilities, as of March 31, 2026, provided their accounts are standard.
- Guarantee coverage: 100% for MSMEs and 90% for non-MSMEs as well as airline sector.
- Tenor of Loan: 5 years (including moratorium of 1 year) for MSMEs/Non-MSMEs and 7 years (including moratorium of 2 years) for airline sector.
