New Delhi, Oct 6 (FN Agency) The government has modified the Emergency Credit Line Guarantee Scheme (ECLGS) to give the civil aviation sector necessary collateral-free liquidity at reasonable interest rates to tide over their present cash flow problems, an official statement said on Wednesday.”Recognising that an efficient and strong civil aviation sector is vital for the economic development of the country, the Department of Financial Services (DFS), Ministry of Finance, has modified the Emergency Credit Line Guarantee Scheme (ECLGS),” the statement said.
The department has decided to enhance the maximum loan amount eligibility for airlines under ECLGS 3.0 to 100% of their fund based or non-fund-based loan outstanding as on the reference dates or Rs 1,500 crore, whichever is lower and of the above, Rs 500 crore shall be considered, based on equity contribution by the owners, the statement added.In March this year, the Emergency Credit Line Guarantee Scheme (ECLGS) was extended beyond March 2022, till March 2023, to implement the announcement made in the Union Budget 2022-23 by Union Finance Minister Nirmala Sitharaman.Keeping in view the high proportion of non-fund based credit in the overall credit of the civil aviation sector, the eligible borrowers were permitted to avail up to 50% of their highest total fund and non-fund based credit outstanding, subject to a maximum of Rs 400 crore per borrower, the statement noted.