Guaranteed Emergency Credit Line (GECL)

  1. Name of the facility

    Guaranteed Emergency Credit Line (GECL)

  2. Facility Type

    Working Capital Term Loan

  3. Validity of Scheme

    Scheme is valid up to October 31, 2020 or on reaching the threshold stipulated as per scheme under the GECL, whichever is earlier

  4. Purpose

    GECL facility will help Business Enterprises to augment their net working capital, meet operational liabilities and restart their businesses during this COVID-19 crisis

  5. Eligibility
    • All Business Enterprises with total outstanding loans of up to Rs. 25 crore as on February 29, 2020, and annual turnover of up to Rs.100 crore in the previous financial year (2019-20) are eligible for GECL funding under the Scheme. In case accounts for FY 2019-20 are yet to be audited/finalised, the Bank may rely upon borrower’s declaration of turnover.
    • Loans provided to Business Enterprises / MSMEs constituted as Proprietorship, Partnership, registered company, trusts and Limited Liability Partnerships (LLPs) shall be eligible under the Scheme. Individual Loans are not eligible under the scheme.
    • Business Enterprises / MSMEs would include loans covered under Pradhan Mantri Mudra Yojana extended on or before February 29, 2020 and reported on the MUDRA portal.
    • The Scheme is valid only for existing customers on the books of the MLI, as on February 29, 2020.
    • Borrower accounts should be less than 60 days past due as on February 29, 2020 in order to be eligible under the Scheme. Borrower accounts which had NPA or SMA-2 status, as on February 29, 2020 shall not be eligible under the Scheme.
    • In order to be eligible, GST registration is a must in all cases where such registration is mandatory. This condition will not apply to borrowers that are not required to obtain GST registration.
    • It is not necessary that the existing loans of the borrowers should be covered under the ECLGS of NCGTC to be eligible for this scheme
  6. Loan Amount

    Maximum up to 20% of the entire fund based outstanding as on February 29, 2020. The maximum exposure is Rs. 5 cr. In case the borrower wishes to take from any lender an amount more than the proportional 20% of the outstanding credit that the borrower has with that particular lender, a No Objection Certificate (NOC) would be required from all other lenders.

  7. Disbursement

    In One tranche

  8. Repayment
    • Tenor: Fixed at 4 years from the date of disbursement
    • Moratorium: Moratorium period of 12 months is provided on the principal amount. Interest shall, however, be payable during the moratorium period
    • The principal shall be repaid in 36 equal installments after the moratorium period is over.
    • Interest to be serviced as and when applied.
    • No processing fees to be charged and pre-payment is allowed at no additional charge to the borrower
  9. Margin

    NIL

  10. Interest Rate

    Maximum Rate of 14% has been prescribed

  11. Security

    Additional Collateral is not required for these cases. The credit under GECL will rank second charge with the existing credit facilities in terms of cash flows (including repayments) and securities.

  12. Documents required
    1. Financial Statements
    2. GST Certificate
    3. Board Resolution for borrowing
    4. Declarations to be signed by the borrower, wherever applicable
    5. KYC, only in case of address change of entity or co-borrower from the existing loans
  13. Extent of guarantee Coverage

    National Credit Guarantee Trustee Company Ltd (NCGTC) shall provide 100% Guarantee coverage on the outstanding amount for the credit facility provided under the scheme as on the date of NPA.

For further details on the GECL product please contact your nearest Branch. We will be glad to assist you.

For GECL Faqs, click here

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