Banks disburse loan worth Rs 1.5 lakh crore under ECLGS: Finance Ministry

Ministry of Finance on Thursday made an important announcement regarding the disbursement under the emergency credit line guarantee scheme (ECLGS).

The scheme was launched as a part of the relief package announced by the Finance Ministry during May 2020. The scheme was aimed to provide major capital relief to micro, small and medium enterprises (MSMEs) economic distress.

The press release by the Ministry informed that the banks under both segments, such as public and private sectors, have sanctioned loans worth over Rs 1.5 lakh crore as of August 18, 2020. The total disbursed amount out of these loans stood at nearly Rs 1 lakh crore.

The numbers published by the Ministry clearly suggested that the scheme was well-utilised by the MSMEs. Public sector banks (PSBs), under the scheme, sanctioned loans worth Rs 76,044 crore, out of which, Rs 56,483 crore were already disbursed.  On the other hand, private banks have sanctioned loans worth Rs 74,715 crore out of which, Rs 45,762 crore has already been disbursed.

In the ranking for top lenders, State Bank of India (SBI), Canara Bank, Punjab National Bank (PNB), Bank of India, Union Bank of India, and HDFC Bank stood as leaders. These loans are backed by the government, thereby reducing the default risks for the banks.