Emergency Credit Line Guarantee Scheme (ECLGS) 5.0

Approval: By the Union Cabinet, chaired by the Prime Minister.
Objective: To address short-term liquidity constraints arising from the West Asia crisis.
- To provide guarantee coverage for default amounts to Member Lending Institutions (MLIs) by the National Credit Guarantee Trustee Company Ltd. (NCGTC).
Key Features of the Scheme
- Eligible Borrowers: MSMEs, non-MSMEs, and Scheduled Passenger Airlines with outstanding credit, having existing working capital limits as of March 31, 2026 (accounts must be standard).
- Guarantee Coverage: 100% for MSMEs; and 90% for non-MSMEs and the airline sector.
- Guarantee Fee: Zero.
- Quantum of Assistance: Up to 20% of the maximum working capital for MSMEs/non-MSMEs (subject to a maximum of ₹100 crore). Up to 100% for airlines (subject to a maximum of ₹1,500 crore).
- Tenor of Loan: 5 years for MSMEs/non-MSMEs (including a 1-year moratorium). 7 years for the airline sector (including a 2-year moratorium).
- Tenor of Guarantee Cover: Co-terminus (of equal duration) with the tenor of the loan.
- Validity of the Scheme: Applicable to all loans sanctioned from the date of issuance of these guidelines by NCGTC up to March 31, 2027.
Impact of the Scheme
- Shielding businesses from challenges arising from the West Asia conflict.
- Maintaining operations, safeguarding jobs, and ensuring the continuity of supply chains.
- Ensuring the provision of working capital to the MSME and airline sectors by banks and financial institutions.
- Promoting uninterrupted domestic production and maintaining the resilience of the ecosystem.