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GUARANTEED EMERGENCY CREDIT LINE (GECL) SCHEME

EXTENDING WORKING CAPITAL TERM LOAN GUARANTEED BY NCGTC, TO SUPPORT THE BORROWERS, WHOSE BUSINESS UNITS HAVE AFFECTED BY THE IMPACT OF COVID-19 PANDEMIC WITH THE MAXIMUM LOAN OF Rs 5.00 Cr.

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:

Particulars Scheme Details
Name of the facility KBL GECL Scheme
Facility Type Working Capital Term Loan
Validity of the Scheme The scheme will be in force up to 31.10.2020 or till an amount of Rs.3,00,000 Crore (as announced by Finance Ministry under COVID-19 Economic package) is sanctioned, across all eligible MLIs (Money Lending Institutions) whichever is earlier.
Purpose To mitigate economic distress being faced by MSMEs/Business Enterprises due to COVID-19 pandemic.
Eligibility
  • All MSME/Business enterprises borrowers with outstanding fund based credit up to Rs. 25.00 Crore across all MLIs as on 29.02.2020 (excluding total Non Funded Based Exposure) with annual turnover up to Rs. 100.00 Crore.
  • For the purpose of the scheme, Business Enterprises/MSMEs would also include loans covered under PMMY Scheme.
  • 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.
Eligible Entities
  • Proprietorship, Partnership, Registered Company, Trusts and Limited Liability partnerships.
  • 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.
Limit of Advance Limit would be up to 20% of their entire outstanding credit (excluding NFB exposure) up to Rs. 25.00 Crore as on 29.02.2020, subject to maximum of Rs. 5.00 Crore.
Period 4 years with moratorium period of 1 year on the principal amount.
Security
  1. Primary charge on the assets financed (wherever applicable)
  2. The GECL facility shall rank second charge with the existing credit facilities, in respect of underlying/existing security held with us as well as cash flows for repayment.
  3. Existing prime and collateral securities shall be continued for proposed facility.
  4. No additional/fresh collateral security required.
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 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)
Margin Nil
Rate of Interest 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.
Charges
  • 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.
Documentation 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, contact our nearest Branch for more details. You may also visit www.ncgtc.in for more information
Conditions Apply