MSME credit guarantee scheme gets a massive boost: Now, individual entrepreneurs can also apply for loans

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Updated: Aug 01, 2020 4:07 PM

The government has today approved the inclusion of individual loans under its ambitious Emergency Credit Line Guarantee Scheme (ECLGS).

msmeAmong other major announcements on Saturday, the government has also ramped up the outstanding loans limit from earlier up to Rs 25 crore to Rs 50 crore.

The government has today approved the inclusion of individual loans under its ambitious Emergency Credit Line Guarantee Scheme (ECLGS). “Taking into account the remaining headroom under the Scheme and after consultations with stakeholders, it is now intended to include individual loans for  business purposes within the ambit of ECLGS,” the Finance Ministry said on Saturday, ET Now reported. As Prime Minister Narendra Modi continues to push for making India self-reliant and as the MSME sector plays an instrumental role in the same, several steps have been taken to strengthen the sector. 

Among other major announcements on Saturday, the government has also ramped up the outstanding loans limit from earlier up to Rs 25 crore to Rs 50 crore. “The maximum amount of GECL funding under the scheme would also correspondingly increase from Rs 5 crore at present (i.e, 20% of 25 crore) to Rs 10 crore,” a notification said. The annual turnover ceiling has also been increased from Rs 100 crore to Rs 250 crore. With these changes, it is likely that the ambit of ECLGS will be expanded by additional amount of more than Rs 1 lakh crore.

Meanwhile, the government is also looking to come up with a new public sector enterprises policy under which, it will define strategic sectors which will not have more than four PSUs (Public Sector Undertakings), Finance Minister Nirmala Sitharaman said, PTI reported. Earlier in May, FM Sitharaman had said that there will be a maximum of four public sectors companies in strategic sectors as part of the ‘Aatmanirbhar Bharat Abhiyan’ package. Other state-owned firms in other segments will eventually be privatised. The strategic sectors is likely to go to the cabinet soon and the government is working on it, FM Sitharaman said.

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