Emergency Credit Line Guarantee Scheme (ECLGS) 5.0

The Emergency Credit Line Guarantee Scheme (ECLGS) 5.0 is a Government of India credit support scheme managed by the National Credit Guarantee Trustee Company Limited (NCGTC) under the Department of Financial Services, Ministry of Finance. The scheme has been introduced to help eligible businesses manage short-term liquidity challenges caused by the West Asia crisis.

Under this scheme, eligible MSMEs, non-MSMEs, and scheduled passenger airline businesses can get additional working capital support from Member Lending Institutions such as banks, financial institutions, NBFCs, and scheduled urban co-operative banks. The main purpose of the scheme is to give lenders a government-backed guarantee so that they can provide additional credit to businesses that need urgent liquidity support.

For MSMEs, the scheme provides 100% guarantee coverage on the amount in default. For eligible non-MSMEs and the airline sector, the guarantee coverage is 90% on the amount in default. The scheme is applicable for loans sanctioned from the date of issue of the guidelines up to 31 March 2027, or until guarantees worth ₹2,55,000 crore are issued, whichever is earlier.

Key Features

• Government-backed credit guarantee:
  ECLGS 5.0 provides guarantee coverage to lenders on additional credit given to eligible borrowers. This helps reduce lender risk and improves access to working capital for businesses.
• Support for MSMEs and eligible non-MSMEs:
  MSMEs and eligible non-MSMEs can get additional working capital term loan support based on their existing fund-based working capital limits.
• 100% guarantee cover for MSMEs:
  For MSME borrowers, the scheme provides 100% guarantee coverage on the amount in default.
• 90% guarantee cover for non-MSMEs and airline sector:
  Eligible non-MSMEs and scheduled passenger airline businesses receive 90% guarantee coverage.
• Loan support up to 20% of peak working capital outstanding:
  For MSMEs and eligible non-MSMEs, the support can be up to 20% of the peak fund-based working capital outstanding during the fourth quarter of FY 2025–26, from 1 January 2026 to 31 March 2026.
• Maximum loan amount:
  For MSMEs and eligible non-MSMEs, the maximum loan amount is ₹100 crore per borrower. For the airline sector, the maximum loan amount is ₹1,500 crore per borrower.
• No guarantee fee and no processing fee:
  Borrowers do not have to pay any guarantee fee under the scheme. Lenders also cannot charge processing fees for sanctioning this facility.
• No prepayment penalty:
  Borrowers can repay the loan early without paying any prepayment penalty.
• Loan tenure:
  For MSMEs and eligible non-MSMEs, the loan tenure is 5 years, including a 1-year moratorium. For the airline sector, the tenure is 7 years, including a 2-year moratorium.

Financial Assistance

Eligibility Criteria

Who Can Apply

Business enterprises, including MSMEs, that had fund-based working capital limits from Member Lending Institutions as on 31 March 2026 can apply.

The borrower’s credit facilities should be classified as standard, excluding SMA-2, as on 31 March 2026.

The borrower account should not be classified as NPA with any lender on the date of sanction or disbursement.

Scheduled passenger airline businesses with outstanding fund-based or non-fund-based credit facilities as on 31 March 2026 may also apply.

Who Cannot Apply

Borrowers whose accounts are classified as SMA-2 or NPA are not eligible.

Borrowers who have already availed additional credit under the Credit Guarantee Scheme for Exporters are not eligible up to the limit already availed under that scheme.

Certain non-MSME sectors are excluded, including NBFCs, power, telecom, sugar and ethanol, IT, paper and paper products, educational institutions, beverages excluding tea and coffee, and tobacco.

Documents Required

• Udyam Registration Certificate, for MSMEs
• Business PAN
• GST registration certificate, if applicable
• Existing working capital sanction letter
• Loan account statement
• Bank statements
• Latest financial statements
• KYC documents of proprietor, partners, directors, or promoters
• Declaration regarding end use of funds
• Details of existing primary and collateral security

Application Process for the Scheme

Option 1: Apply with Bullit (Recommended)

Apply with Bullit for guided support. Our team helps check eligibility, review documents, understand the eligible loan amount, and coordinate with the lending institution for the ECLGS 5.0 application.

Recommended for MSMEs and eligible businesses that want help in understanding and applying for additional working capital support.

Option 2: Apply Through Existing Bank or Lender

Contact the bank, NBFC, financial institution, or scheduled urban co-operative bank where your business already has working capital limits. The lender will check eligibility, calculate the eligible credit amount, collect documents, and sanction the loan if the business meets scheme requirements.

Option 3: Through MSME Support Office or Financial Advisor

You may also approach an MSME office, CA, or financial advisor for help with eligibility checks and documentation. Final sanction and disbursement will be done by the Member Lending Institution.