On Monday, the finance minister Nirmala Sitharaman via a video conference reached out to private sector lenders and NBFCs asking them to join hands with their public sector counterparts and up their level of credit disbursal to small businesses.
The minister told companies including Tata Motors Finance Solutions, Edelweiss, ICICI Bank, HDFC Bank etc. to employ the recently launched government backed collateral free emergency credit guarantee lending scheme (ECGLS) to help small business amid Covid 19 crisis.
To this lenders responded that they have already implemented the scheme.
Also, while a host of lenders from the two categories have already come up with the scheme, few have even asked the centre to expand the scope such that more borrowers can benefit from the scheme.
The government scheme shall also help small businesses in meeting their payments related to salaries, rent as well as the restocking costs.
Also lenders are asking the centre to cover professionals as well as individuals who are running businesses but are not exclusively registered as MSMEs as part of the scheme. Under the scheme the government is extending 100% guarantee against any loan defaults.