The Emergency Credit Line Guarantee Scheme (ECLGS) 5.0 has crossed a major milestone, with the total number of guarantees issued under the scheme surpassing 1 lakh. According to information released by the government, 1,06,549 guarantees had been issued as of June 9, 2026, covering a total guaranteed amount of ₹48,484.26 crore.
The scheme, approved by the Union Cabinet on May 5, 2026, was introduced to address liquidity pressures faced by businesses following the West Asia crisis. By providing government-backed guarantees on loans, the initiative aims to encourage lenders to extend additional credit to eligible borrowers.
Micro, Small and Medium Enterprises (MSMEs) have emerged as the largest beneficiaries of the scheme. Of the total guarantees issued, 96% by number were extended to MSMEs, accounting for 86% of the overall guaranteed amount. Public Sector Banks (PSBs) have also played a leading role in implementing the programme, issuing 96% of the guarantees.
Key Highlights
- ECLGS 5.0 guarantees issued crossed the 1 lakh mark as of June 9, 2026.
- A total of 1,06,549 guarantees were issued under the scheme.
- The total guaranteed amount stood at ₹48,484.26 crore.
- MSMEs accounted for 96% of guarantees by number and 86% of the total guaranteed amount.
- Public Sector Banks issued 96% of the guarantees under the scheme.
- The programme aims to facilitate additional credit of ₹2.55 lakh crore to existing borrowers affected by liquidity challenges linked to the West Asia crisis.
MSMEs Account for the Majority of Coverage
The data highlights the significant role of ECLGS 5.0 in supporting the MSME sector, which forms the backbone of India’s business ecosystem. The high share of guarantees issued to MSMEs indicates that the scheme has largely been utilised by smaller businesses seeking access to credit during a period of financial stress.
Under the scheme, eligible MSME borrowers receive loans backed by a 100% government guarantee. For non-MSME borrowers, lenders receive a 90% guarantee cover. This risk-sharing mechanism is designed to encourage banks and financial institutions to extend credit more confidently.
The government has stated that ECLGS 5.0 seeks to facilitate additional credit amounting to ₹2,55,000 crore for existing borrowers to help them overcome liquidity challenges arising from the West Asia crisis.
Also Check: India Approves ECLGS 5.0 Amid West Asia Crisis: Key Benefits for MSMEs and Airlines
Broad Participation from Lending Institutions
The scheme has witnessed participation from a wide range of financial institutions, allowing it to achieve broad geographical and sectoral coverage. Participating institutions include Public Sector Banks, Private Sector Banks, Regional Rural Banks (RRBs), Small Finance Banks (SFBs), and Non-Banking Financial Companies (NBFCs).
Public Sector Banks have been the primary channel for implementation, accounting for 96% of the guarantees issued. Their extensive branch network and operational reach have contributed to the rapid adoption of the scheme.
Member Lending Institutions also undertook efforts to increase awareness among eligible borrowers through their websites, emails, SMS communications, and other outreach channels.
Outreach Efforts to Expand Awareness
To improve access and awareness, the Department of Financial Services (DFS) organised outreach programmes at nine locations through State Level Bankers’ Committees (SLBCs). These programmes involved participation from the National Credit Guarantee Trustee Company (NCGTC), the PSB Alliance team, state MSME and commerce departments, banks, industry associations, and business enterprises.
According to the government, a second phase of these outreach initiatives is currently under active consideration.
Source: Ministry of Finance
