The Narendra Modi government is going all out to ensure that liquidity concerns of the MSME sector are addressed on priority under its Emergency Credit Line Guarantee Scheme (ECLGS). As of June 18, 2020, public sector banks have sanctioned loans worth Rs 40,416 crore under the 100 per cent Emergency Credit Line Guarantee Scheme, out of which Rs 21,028.55 crore has already been disbursed.
There has been a big jump in disbursement over the week as the amount was just around Rs 16,000 crore on June 12. Even sanctions have increased rapidly during the period rising up by over Rs 8,000 crore.
In a tweet, the office of Finance Minister Nirmala Sitharaman said: “As of 18 June 2020, #PSBs have sanctioned loans worth Rs 40,416 crore under the 100 per cent Emergency Credit Line Guarantee Scheme, out of which Rs 21,028.55 crore has already been disbursed.”
The ECLGS scheme is the biggest fiscal component of the Rs 20-lakh crore Self-Reliant India Mission package announced by Sitharaman last month.
To ensure that the scheme achieve its objective of providing adequate liquidity to the MSME segment during the current difficult period, the finance ministry has regularly held meetings with the banks.
After PSBs, the government is also prodding the private banks to increase loans under the scheme. As part of this, Sitharaman on Monday chaired a meeting with Private banks and NBFCs to take stock of their preparedness to provide liquidity to the sector.
The Rs 21,000 crore disbursement has been made to a wide spectrum of MSMEs covering 5,81,296 accounts. Country`s largest lender State Bank of India has been on the forefront of releasing loans under the scheme while industries in Tamil Nadu and Maharashtra have been the biggest beneficiaries.