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Guaranteed Emergency Credit Line (GECL) Facility Details

S.No.

Parameter

Guidelines

1

Name

  • ‘Emergency Credit Line Guarantee Scheme (ECLGS)’ (hereinafter referred as the ‘Scheme’) with two components, ECLGS 1.0 & ECLGS 2.0.

i. ECLGS-1.0 to borrowers whose total credit outstanding (fund based only) across all lending institutions and days past due as on February 29, 2020 was upto Rs.50 crore and upto 60 days respectively.

ii. ECLGS-2.0 to borrowers in the 26 sectors identified by the Kamath Committee on Resolution Framework vide its report dated 04.09.2020 and the Healthcare sector whose total credit outstanding (fund based only) across all lending institutions and days past due as on February 29, 2020 was above Rs.50  crore and not exceeding Rs.500 crore and upto 30 days respectively.

  • The credit product for which guarantee would be provided under the Scheme shall be named as ‘Guaranteed Emergency Credit Line (GECL)’

2

Purpose

  • This is a special Scheme in view of COVID-19 crisis. It seeks to provide additional liquidity, thereby enabling Business Enterprises / MSMEs including PMMY borrowers to meet their operational liabilities and restart their businesses.
  •  To provide 100% guarantee coverage for the GECL, which shall be a pre-approved sanction limit of up to 20% of loan outstanding as on 29th February, 2020 to eligible borrowers, in the form of additional working capital term loan facility (under both ECLGS 1.0 and 2.0) and/or non-fund based facility (only under ECLGS 2.0).

3

Nature of Facility

  • Fund Based: Working Capital Term Loan under both ECLGS 1.0 and 2.0.
  • Non Fund Based: only under ECLGS 2.0 (maximum upto 25% of total credit including funded facility under GECL)

4

Eligible Borrower

  1. “Eligible borrower” under ECLGS 1.0
    • All Business Enterprises / MSMEs / individuals who have availed loan for business purposes with total credit outstanding (fund based only) of up to Rs.50 crore as on 29.2.2020.
    • Borrower accounts should be less than or equal to 60 days past due as on 29th February, 2020 in order to be eligible under the Scheme.
  2. “Eligible borrower” under ECLGS 2.0
    • All Business Enterprises/MSMEs in the 26 sectors identified by the Kamath Committee on Resolution Framework (attached as Annexure I) and the Healthcare sector who have availed loan for business purposes with total credit outstanding (fund based only), across lending institutions, above Rs.50 crore and not exceeding Rs.500 crore as on 29.02.2020.
    • To be eligible under ECLGS 2.0, the borrower accounts should be less than or equal to 30 days past due as on February 29, 2020.
  3. However, exception has been allowed for overdues of the borrower in respect of their credit card/savings account/current account provided the said overdues did not exceed 1% of the loan amount (i.e. GECL amount) extended under the scheme and that the overdue amount was regularized prior to assistance being extended under the scheme and provided further that the Bank ensure that the overdues were covered by the materiality concept being followed by the Bank.
  4. For the purpose of this scheme, the term ‘Business Enterprises/MSMEs’ would also include loans covered under Pradhan Mantri Mudra Yojana (PMMY).
  5. The Scheme is valid for existing customers on the books of the Bank.

5

Quantum of Finance

  1. Under ECLGS 1.0
    • The amount of GECL funding to eligible borrowers in the form of additional working capital term loan facility would be up to 20% of their total credit outstanding up to Rs.50 crore (fund based only) as on 29th February, 2020, subject to the borrower meeting all the eligibility criteria.
  2. Under ECLGS 2.0
    • The amount of GECL funding to eligible borrowers either in the form of additional working capital term loan facility and / or non-Fund based facility or a mix of the two, would be up to 20% of their total credit outstanding (fund based only) up to Rs. 500 crore as on 29th February, 2020, subject to the borrower meeting all the eligibility criteria.
    • Credit facility under ECLGS 2.0 could be in the form of fund based or non-fund based facility or a mix of the two.

6

Tenure

  1. Under ECLGS 1.0: The door to door tenor of loans provided under GECL shall be four years from the date of first disbursement.
  2. Under ECLGS 2.0: The door to door tenor of facilities provided under GECL shall be for a period of five years from the date of first disbursement of fund based facility or first date of utilization of non-fund based facility, whichever is earlier. To be eligible for guarantee cover of the sanctioned non-fund based facility, first utilization must happen on or before June 30, 2021.

7

Moratorium

  • A moratorium period of one year on the principal amount shall be provided under this scheme.
  • Interest shall be payable during the moratorium period.
  • The principal shall be repaid in 36 installments under ECLGS 1.0 and in 48 instalments under ECLGS 2.0 after the moratorium period is over.

8

Disbursal & Repayment

  • The borrower account eligible under the scheme should not be an NPA as on the date of sanction / disbursement.
  • The last date of disbursement for fund based facility under the scheme (ECLGS 1.0 & ECLGS 2.0) shall be June 30, 2021.
  • The principal shall be repaid in 36 installments under ECLGS 1.0 and in 48 instalments under ECLGS 2.0 after the moratorium period is over.
  • The facility will be considered as an exposure on the borrower and guidelines stipulated under the RBI Prudential Norms shall be adhered to.

9

Margin

  • NIL
  • In case of Non-funded facility under ECLGS 2.0: The margin should be as per existing non-funded facility.
  • In case, there is no existing  non-funded facility, the margin of 25% should be taken (only for non-funded portion of ECLGS 2.0).

10

Rate of Interest / commission for Non-Funded facility

Rate of Interest

  1. MSMEs
    • RLLR + 0.05% subject to a minimum RoI of 7.5% and a maximum up to 9.25%. (During the entire tenure of this loan facility).
  2. Non- MSMEs
    • MCLR + spread of 0.20% to 1% to be decided by the sanctioning authority on case to case basis (subject to a minimum RoI of 7.5% and a maximum up to 9.25% during the entire tenure of this loan facility).

Commission on Non-Funded Facility:

  • In case of existing non-fund facility: Charges as per existing sanction.
  • In case of fresh sanction of non-fund facility: As per extant guidelines of service charges

11

Security

  • second charge with the existing credit facilities in terms of cash flows (including repayments) and security
  • The stipulation of second charge has been waived in respect of all loans up to Rs.25 lakh (outstanding as on February 29, 2020 plus loan sanctioned under GECL), subject to Bank ensuring to safeguard the interests of NCGTC.

12

Collateral

No additional collateral shall be asked for additional credit extended under this scheme.

13

Scheme Validity

The Scheme would be applicable to all loans sanctioned under GECL during the period from the date of issue of these guidelines by NCGTC to 31.03.2021 or till guarantees for an amount of Rs 3,00,000 crore is sanctioned under the GECL (taking into account both ECLGS 1.0 and 2.0), whichever is earlier.

However, disbursement can be availed after March 31, 2021, but latest by June 30, 2021. Facility under non-fund based portion can be availed during the 5-year tenor of facility sanctioned provided the first tranche has been utilized on or before June 30, 2021.

14

Guarantee Coverage

  • The National Credit Guarantee Trustee Company Limited (NCGTC) shall provide 100% Guarantee coverage on the outstanding amount for the credit facility provided under the Scheme as on the date of NPA or on the date of lodgment of claim, whichever is lower.

15

Guarantee Fee

No Guarantee Fee for all credits facilities provided

under this scheme

16

Processing Fee

Nil

17

Prepayment Charges

Nil

18

Documentation/Other Charges

As per extant guidelines of Bank

 

26 sectors identified by the Kamath Committee on Resolution Framework

Sr. No.

26 sectors identified by the Kamath Committee on Resolution Framework vide its report dated 04.09.2020

1

Auto Components

2

Auto Dealership

3

Automobile Manufacturing*

4

Aviation**

5

Building Materials - Tiles

6

Cement

7

Chemicals

8

Construction

9

Consumer Durables / FMCG

10

Corporate Retails Outlets

11

Gems & Jewellery

12

Hotel, Restaurants, Tourism

13

Iron & Steel Manufacturing

14

Logistics

15

Mining

16

Non Ferrous Metals

17

Pharmaceuticals Manufacturing

18

Plastic Products Manufacturing

19

Port & Port Services

20

Power

  • Generation
  • Transmission
  • Distribution

21

Real Estate

  • Residential
  • Commercial

22

Roads

23

Shipping

24

Sugar

25

Textiles

26

Trading – Wholesale