The ECLG program was launched to help businesses affected by the COVID-19 pandemic.
Debt information firm TransUnion CIBIL said that NPAs or bad debts are high in the services and infrastructure sectors. These areas with high contact and movement intensity have been the most affected by the pandemic.
The government had put in place a program to help lenders affected by the pandemic. Under this, a 100% guarantee was given to financial institutions with the aim of making loans easily accessible to businessmen. With the increase in the scope of the program, its duration has been extended till March 2023. Under this, the total expenditure has now been increased to five lakh rupees.
The report indicates that this program has been successful in helping Indian businessmen cope with the economic crisis caused by the Covid-19 epidemic and the “lockdown” imposed for its prevention.
About ECLGS National Credit Guarantee Trustee Company Ltd.
Rajesh Kumar, Managing Director and Chief Executive Officer of the company, said, “The rapid disbursement of credit through the ECLGS has significantly contributed to the revival of various businesses across all geographies. Along with this, loans to MSMEs (micro, small and medium enterprises) were prevented from becoming NPAs.
“The NPA rate of 4.8% for borrowers who took advantage of the ECLGS facility is lower than for units that were eligible but did not take advantage of the facility. In his case, the NPA was 6.1%.
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