Another likely expansion for the secured loan scheme; a major advantage for hospitals could be on the cards

The government’s Emergency Credit Linked Guarantee (ECLGS) program could see a major scale-up – to Rs 5 lakh crore from Rs 3 lakh crore at present.

In addition, the scope of the program is likely to be broadened to include hospitals with a view to strengthening health infrastructure in the country, ToI reported, citing sources.

The increase in size became necessary as loans under the program approached the initial ceiling of Rs 3 lakh crore faster than expected. The ECLGS was originally limited to micro, small and medium-sized enterprises, but was later extended to a multitude of other sectors as well.

As part of the ECLGS health establishment plan, new and old hospitals will now be eligible for loans, according to the report citing the sources.

Hospitals will be allowed to benefit from a maximum of Rs 100 crore in loans under the ECGLS. Installations in non-metropolitan cities will also be eligible.

National Credit Guarantee Trustee Company will guarantee up to 75% of the funding in the event that a new hospital is set up. For existing hospitals that need to be expanded, the guarantee would be 50%.

The Ministry of Finance is currently obtaining the necessary authorizations for the latest extension of ECGLS. The extended scope will come into effect as soon as these authorizations are obtained.