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KBL GECL 1.0 Scheme

Guaranteed Emergency Credit Line (GECL) 1.0 Scheme

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.

  • All MSME/Business enterprises borrowers and loan sanctioned to individuals for specific business purpose with outstanding fund based credit up to Rs. 50.00 Crore across all MLIs as on 29.02.2020.
  • For the purpose of the scheme, Business Enterprises/MSMEs/individuals would also include loans covered under PMMY Scheme.
  • Scheme is eligible for existing customers in the book of the Bank.
  • Borrower accounts (our Bank/Other banks/FIs/NBFCs) should be less than or equal to 60 days past due as on 29.2.2020. Borrowal accounts which are NPA or SMA-2 status as on 29.2.2020 shall not be eligible under the scheme.
  • Exception to the above is allowed for overdue in respect of credit card/savings/current account subject to
    • Overdue shall not exceed 1.00% of the eligible GECL loan limit.
    • Overdue amount shall be regularized and request for GECL shall be submitted along with receipt/acknowledgement for regularization of overdue.

4 years with moratorium period of 1 year on the principal amount.

  • Primary charge on the assets financed (wherever applicable)
  • Pari Passu charge on existing securities as well as cash flows of repayment
  • Existing prime and collateral securities shall be continued for proposed facility.
  • No additional/fresh collateral security required.
  • Repayable in 36 installments after initial moratorium period of one year on the principal amount. Interest to be serviced by the borrower as and when applied (including during the moratorium period)
  • Nil
  • 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.


  • To mitigate economic distress being faced by MSMEs/Business Enterprises due to COVID-19 pandemic.

Facility Type:

  • Working Capital Term Loan

Eligible Entities:

  • Proprietorship, Partnership, Registered Company, Trusts, Limited Liability partnerships, Individual where loans are sanctioned for specific business purpose.
  • Loans sanctioned to individuals are not covered under the Scheme. However loans sanctioned to individuals under Pradhan Mantri Mudra Yojana scheme (PMMY) are covered which are reported to PMMY portal on or before 29.02.2020.

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


  • Processing Charges - Nil
  • Prepayment Charges - Nil
  • No penal interest to be charged for proposed facility due to any non compliance of the previous sanction terms & conditions. However penal interest of 5% will be charged for overdue instalments or interest for proposed working capital term loan.

Limit of Advance:

  • Limit would be up to 20% of their entire outstanding credit under Fund Based exposure up to Rs. 50.00 Crore with all money lending institution as on 29.02.2020, subject to maximum of Rs. 10.00 Crore. Note: NOC from other MLIs shall be submitted if the borrower is willing to avail the entire eligible GECL limit with our bank.

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.


  • 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.


  • As applicable for Working Capital Term Loans

General guidelines:

  • Business Enterprises/MSME borrower must be GST registered in all cases except where it is exempted from GST registration.
  • In case of accounts for FY 2019-20 are yet to be audited/finalized, the declaration of borrower if the turn over for the FY 2019-20 is less than Rs 500.00 lakh and if turnover is more than Rs 500.00 lakh, borrower has to submit the sales turnover report duly certified by the Chartered Accountant.

For further details on the GECL product, please contact the nearest Branch

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