Emergency Credit Line for MSME and Business Enterprises


Nature of Facility:
Additional Working Capital Term Loan


Eligible Borrowers:

  1. All Business Enterprises /MSME borrower accounts with combined outstanding loans across all lenders of up to Rs. 25 Crore as on 29.2.2020, and annual turnover of up to Rs. 100 Crore for FY 2019-20 are eligible for the Scheme.

  2. Loans provided to Business Enterprises / MSMEs constituted as Proprietorship, Partnership, registered company, trusts and Limited Liability Partnerships (LLPs) shall be eligible under the Scheme. For instance, any existing loan such as CV loan taken by an entity shall be covered but CV loan taken by promoter or director in personal capacity shall not be covered.

  3. For the purpose of this Scheme, Business Enterprises / MSMEs would include loans covered under Pradhan Mantri Mudra Yojana extended on or before 29.2.2020 and reported on the MUDRA portal. All eligibility conditions including the condition related to Days past due would also apply to PMMY loans.

  4. For loans having co-applicant, only those existing loans where entity is the primary co-applicant are covered under the Scheme for additional emergency funding.

  5. Loans provided in individual capacity (except individual MUDRA loans) are not covered under the Scheme.

  6. The Scheme is valid for existing customers on the books of IDFC FIRST Bank. Borrower accounts should be less than or equal to 60 days past due as on 29th February, 2020 in order to be eligible under the Scheme. i.e. All borrowers which have not been classified as SMA 2 or NPA by any of the lending institutions as on 29th February, 2020 will be eligible for the Scheme.

  7. Business Enterprises / MSME borrower accounts which had NPA or SMA-2 status as on 29.2.2020 shall not be eligible under the Scheme.


Features of the scheme:

  1. Up to 20% of the Combined Fund Based outstanding as on 29/02/2020 with All the Lending Institutions – Maximum amount Rs 5 Crore

  2. 4 years from the date of disbursement.

  3. Moratorium period of one year on the principal amount shall be provided to borrowers during which interest shall be payable.

  4. Currently 9.25% p.a.p.m

  5. Nil Processing Charges

  6. No Prepayment Charges


Check Eligibility

Alternatively, you may write to us at ECL@idfcfirstbank.com or call 1860 500 9900 for more details.


Frequently Asked Questions

1. What is the Scheme Name?

The scheme ECLMB (Emergency Credit Line for MSME and Business Enterprises) provides additional credit to MSMEs and Business Enterprises.

2. What is the objective of the Scheme?

The Scheme is a specific response to the unprecedented situation COVID-19. It seeks to provide much needed relief to the MSME sector, thereby enabling MSMEs/Business Enterprises to meet their operational liabilities and restart their businesses. Hereinafter MSME to include Business Enterprises

3. What will be the eligibility criteria for MSMEs to avail the benefit of the Scheme?

The eligibility criteria under the Scheme are as under:
• All MSME borrower accounts with combined outstanding loans across all Lending institutions of up to Rs. 25 Crore as on 29.2.2020, and annual turnover of up to Rs. 100 Crore in FY 2019-20.
• The Scheme is valid only for existing customers on the books of the IDFC FIRST Bank. • Borrower accounts should be classified as regular, SMA-0 or SMA-1 as on 29.2.2020. Accounts classified as NPA or SMA-2 as on 29.2.2020 will not be eligible under the Scheme.
• The MSME borrower must be GST registered in all cases where such registration is mandatory. This condition will not apply to MSMEs that are not required to obtain GST registration.
• Loans which are covered includes LAP and BIL products. However, loans provided in individual capacity (except individual MUDRA loans) will not be covered under the Scheme.

4. Will the Scheme also cover borrowers under PMMY?

Yes, loans under PMMY extended on or before 29.2.2020, and reported on the MUDRA portal shall be covered under the Scheme.

5. Will facility be extended as a separate loan account, or as part of the existing loan account of the borrower?

A separate loan account shall be opened for the borrower for extending additional credit under Scheme Name. This account will be distinct from the existing loan account(s) of the borrower.

6. Will loans under the Scheme be automatically given without any application or solicitation from the borrower?

This is a pre-approved facility. An offer will go out from the Bank to the eligible borrowers for a pre-approved facility which the borrower may choose to accept. Thus, an ‘opt-out’ option will be provided to eligible borrowers under the Scheme, i.e., if the borrower is not interested in availing the loan, he/she may indicate accordingly. If the MSME/Business Enterprises accepts the offer and fulfils the eligibility norms of the bank to avail sanction, it will be required to complete requisite documentation to avail the sanction.

7. What would be the procedure followed in case a borrower has loan accounts with multiple lenders?

•In case a borrower has existing limits with multiple lenders, facility may be availed either through one lender or each of the current lenders in proportion depending upon the agreement between the borrower and the lending institution.
• 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.
• No NOC will, however, be required if the facility availed from a particular lender is limited to the proportional 20% of the outstanding credit that the borrower has with that lender.

8. To avail this facility, will it be necessary for existing loans of the borrower to be covered under existing guarantee schemes such as CGFMU or CGTMSE?

No.

9. Will the interest rate on this facility be capped?

Yes, interest rates on GECL shall be capped under one of the RBI prescribed external benchmark linked rates +1% subject to a maximum of 9.25% per annum.

10. What would be the tenor of loans provided under GECL?

The tenor of loans provided under this Scheme shall be four years from the date of disbursement. No pre-payment penalty shall, however, be charged by IDFC FIRST Bank in case of early repayment.

11. Is there any moratorium period prescribed under the Scheme?

Yes, a moratorium period of one year on the principal amount shall be provided under this scheme. Interest shall, however, be payable during the moratorium period. The principal shall be repaid in 36 instalments after the moratorium period is over.

12. Will any processing fee be charged for sanction of loans under this scheme?

Since additional credit under Scheme is to be provided to existing customers, no additional processing fee shall be charged by lenders.

13. Would this facility require additional collateral?

No additional collateral shall be asked for additional credit extended under this scheme.

14. Will the categorization of existing loans extended through current Government schemes such as PMEGP or PMMY change if facility is provided to such borrowers?

No. Existing loans extended through current Government schemes would continue to be categorized under that scheme as earlier. GECL under this Scheme shall be over and above the existing loan.

15. What will be the security on credit extended under this Scheme?

The credit under this facility will rank second charge with the existing credit facilities in terms of cash flows (including repayments) and securities, with charge on the assets financed under the Scheme to be created within a period of 3 months from the date of disbursal.

16. I run a business enterprise and have a GST registration. However, I am not registered as an MSME nor do I have Udyog Aadhar. Am I eligible under the scheme?

You are eligible if:
(i) you have total credit outstanding of Rs. 25 Crore or less as on 29th Feb 2020
(ii) your turnover for 2019-20 was upto Rs. 100 Cr.
(iii) You have a GST registration or were not required to obtain such GST registration
Udyog Aadhar or recognition as MSME is not required under this Scheme

17. The Bank has offered me a pre-approved loan of 15% only though the scheme mentions 20%. Can the Bank do so?

Under this scheme, Bank is to offer loans upto 20%. Actual loan extended can therefore be less than 20%. This is generally on mutually agreed terms between the borrower and the lender based on factors relevant to the business operations.

18. I run a retail shop. Am I eligible for coverage?

See answer to question 16

19. I operate a lending business. Am I eligible?

No.

20. Can new MSME borrowers get covered under the scheme?

This scheme is only for existing borrowers on the books of IDFC FIRST Bank as on 29th Feb 2020. Any New borrowers should be covered under ongoing CGTMSE and NCGTC schemes

21. Can co-applicant loans between entity and the promoter or director get covered under the scheme ?

For loans having co-applicant, only those existing loans where entity is the primary co-applicant are covered under the Scheme for additional emergency funding.

22. Are off balance sheet loans provided to MSME borrowers covered as part of the scheme?

No, the scheme does not cover the off-balance sheet exposure. Only on balance sheet exposures outstanding as on 29th Feb, 2020 are eligible to be covered under the scheme.

23. I am not a registered MSME and operate a general/retail business. My account was NPA as on 29th Feb, 2020. Am I eligible for this scheme?

Accounts that are NPA or where overdues have crossed 60 days (SMA-II) are not eligible under this scheme.

24. Who can provide answers to any further queries?

Please address your queries/suggestions to our nearest IDFC FIRST Bank Branch or call at 1860 500 9900 or mail at ECL@idfcfirstbank.com.

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Contact us

REGISTERED office:

IDFC FIRST Bank Ltd

KRM Tower, 7th Floor, No. 1,
Harrington Road, Chetpet,
Chennai - 600031, Tamil Nadu,
India

Corporate office:

IDFC FIRST Bank Ltd

Naman Chambers,
C-32, G-Block,
Bandra-Kurla Complex,
Bandra East, Mumbai - 400051,
India

IDFC FIRST Bank Customers

Toll Free No - 1800 419 4332
Email - Banker@idfcfirstbank.com

Capital First Customers

Toll Free No - 1860 500 9900
Email - Customer.Care@Capitalfirst.Com

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