Government of India and RBI has taken various measures for combating the challenges faced by the Indian economy due to COVID-19 crisis. As part of relief measure Department of Financial Service has introduced the Emergency Credit Line Guarantee Scheme (ECLGS) for providing 100% guarantee coverage for additional working capital term loans to eligible borrowers. In line with the guidelines of ECLGS scheme, a new product KBL- GECL (Guaranteed Emergency Credit Line) has been introduced by our Bank to provide additional Working Capital term Loan (WCTL) facility to COVID affected borrowers. The key highlights of the scheme are as follows:
|Name of the facility||KBL GECL 2.0 Scheme|
|Facility Type||Fund Based Facility: Working Capital Term Loan
Non Fund Based Facilities: Inland/Import LC (DP/DA)/Bank Guarantee/Forward Contract Facility etc.
Or a mix of both fund based and non fund based facilities
|Validity of the Scheme||The scheme will be in force up to 31.03.2021 or till the guarantee for an amount of Rs.3,00,000 Crore (as announced by Finance Ministry under COVID-19 Economic package) is sanctioned under GECL, across all eligible MLIs (Money Lending Institutions) whichever is earlier.|
|Purpose||To mitigate economic distress being faced by MSMEs/Business Enterprises (eligible 26 sectors identified by Kamath Committee + Health Care sector) due to COVID-19 pandemic.|
|Limit of Advance||Limit would be up to 20% of their entire outstanding credit under Fund Based exposure up to Rs. 500.00 Crore with all money lending institution as on 29.02.2020, subject to maximum of Rs. 100.00 Crore.
Note: NOC from other MLIs shall be submitted if the borrower is willing to avail the entire eligible GECL limit with our bank.
|Period||Working Capital Term Loan(FB limit):
5 years with moratorium period of 1 year on the principal amount.
Non Fund Based Limits:
Nil moratorium and limits shall be amortised over the period of loan (i.e., maximum tenure of 5 years) on progressive basis with minimum amortisation of 20% each year.
1. First Tranche of sanctioned Non Fund Based facility shall be utilised on or before 30.06.2021 or else said sanction shall be stands cancelled.
2. Due date of non fund based facilities shall be after 5 years from the date of first disbursement/utilization out of the sanctioned fund based/non fund based facility whichever is earlier.
|Guarantee Coverage||The National Credit Guarantee Trustee Company Limited (NCGTC) shall provide 100% guarantee coverage on the outstanding amount for the credit facility provided under the scheme.
For NCGTC Guidelines please visit https://www.eclgs.com/
|Disbursal||A separate loan account shall be opened and the borrower can avail the sanctioned amount in one go. The facility shall be made available as Fund Based Limit Only.|
|Repayment||Repayable in 48 monthly installments after initial moratorium period of one year (12 months) on the principal amount. Interest to be serviced by the borrower as and when applied (including during the moratorium period)|
|Rate of Interest/Commission||Fund Based Facilities:
8.96% p.a. i.e., External Bench Mark - 10 year G-sec (presently 6.21%) plus KBL spread of 2% plus 0.75%; with a maximum cap of 9.25% p.a.
Non MSME Borrowers:
3 months/6 months/One Year MCLR + spread with a maximum cap of 9.25%
Note: MCLR and EBLR will be reset on periodical basis.
Non Fund Based Facilities:
As per the service charge circular of our bank
|Documentation||As applicable for Working Capital Term Loans and non fund based working capital limits|
For further details on the GECL product, please contact your branch.