New Delhi, May 31 (KNN) In a bid to support MSMEs, the Central Government has expanded the scope of the Emergency Credit Line Guarantee Scheme (ECLGS) to September 30, 2021, from June 30, 2021, or till guarantees for an amount of Rs 3 lakh crore are issued.

According to an official statement from the Finance Ministry, under 'ECLGS 4.0', 100 per cent guarantee cover will be extended to loans of up to Rs 2 crore given to hospitals, nursing homes, clinics, medical colleges for setting up on-site oxygen generation plants.

''The interest rate has been capped at 7.5 per cent for the same. The Civil Aviation sector is eligible under ECLGS 3.0. Validity of ECLGS extended to September 30, 2021, or till guarantees for an amount of Rs 3 lakh crore is issued,'' the statement added.

The government has permitted the disbursement under the scheme up to December 31, 2021. The current ceiling of Rs 500 crore of loan outstanding for eligibility under 'ECLGS 3.0' will be removed, subject to maximum additional ECLGS assistance to each borrower is limited to 40 per cent or Rs 200 crore.

''The modifications in ECLGS would enhance the utility and impact of ECLGS by providing additional support to MSMEs, safeguarding livelihoods and helping in the seamless resumption of business activity. These changes will further facilitate the flow of institutional credit at reasonable terms,'' it added.

''The instant decision will have limited impact. It needs to be expanded ( more money put in) & the eligibility clause to avail ECLGS schemes specified under 1.0, 2.0, 3.0 & 4.0 need to be declared for all Standard Accounts as on 29/2/2020 instead of dues pending 60days and below (i.e., SMA- 1 ),'' The Federation of Indian Micro and Small & Medium Enterprises (FISME) said.