Loan Process Guides

Emergency Credit Line Guarantee Scheme

Emergency Credit Line Guarantee Scheme

Scheme Description

Government of India through Ministry of Finance has introduced the Emergency Credit Line Guarantee Scheme (ECLGS) for providing 100% guarantee coverage for additional term loans up to 20% of the outstanding credit as on February 29, 2020 to eligible borrowers. Credit Product for which guarantee would be provided under this scheme is named as ‘Guaranteed Emergency Credit Line’ (GECL).

Scheme Validity

Additional loans can be availed under this scheme up-to October 31, 2020 or till an amount of Rs 3 lakh crore has been sanctioned under GECL, whichever is earlier.

Eligibility Criteria under the Scheme

  • All Business Enterprises/MSME borrowers constituted as Proprietorship, Partnership, Registered Company, Trusts, LLP and interested borrowers under Pradhan Mantri Mudra Yojna, meeting below mentioned criteria:-
  • O/s loans of upto Rs 25 Cr across all Member Lending Institutions (MLI), as on 29 th Feb’20
  • Annual turnover of upto Rs 100 Cr in FY20 (In case accounts for FY20 have not been finalized, turnover declaration to be provided by borrower)
  • Only for existing borrowers on the books of Hero Housing Finance Limited (HHFL) where the primary applicant for the loan is an entity\
  • Account should be less than or equal to 60 DPD as on February 29,2020 across all MLI
  • GST registration, wherever it is mandatory. Condition will not apply to MSMEs that are not required to obtain GST registration
  • Loans provided in individual capacity will not be covered under the scheme

Eligibility criteria for borrowers do not specifically require the MSME to be registered under the MSMED act. An unregistered MSME can also be an eligible borrower, if it satisfies the above mentioned criteria 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

Loan Amount Eligible

  • For borrowers having loan facility only with HHFL, loan amount eligible would be upto* 20% of the loan O/s from HHFL, subject to maximum amount of Rs 5 Cr
  • For borrowers having loan facility with HHFL and other lenders, loan amount eligible from HHFL can be upto* 20% of the total outstanding across all lenders, subject to maximum amount of Rs 5 Cr. (NOC would be required from other lenders for HHFL to disburse more than 20% of HHFL’s loan outstanding)

*Loan Amount shall be decided on the basis of simplified due diligence undertaken by HHFL on existing customers eligible under this scheme.


  • Tenor of 4 years from the date of disbursement
  • Moratorium period of 1 year on the principal, interest to be serviced at monthly intervals
  • Principal shall be paid in 36 instalments after the moratorium is over

Interest Rate

Interest rate for GECL facility shall not exceed 14% p.a. Account can be operated in conjugation with any interest rate subvention scheme

Collateral Details

  • Facility granted under GECL shall rank second charge with the existing credit facilities of the borrower with HHFL, in terms of cash flows (including repayments) and security. Charge on the assets financed under the scheme to be created within a period of 3 months from date of disbursal
  • No additional collateral shall be asked for additional funding under GECL


  • Processing Fee :- Nil
  • Prepayment Charges :- Nil
  • Penal Interest :- Nil

Application Process

  • An offer shall be sent out from HHFL via SMS or Email to eligible borrowers for a pre-qualified loan, which the customer may choose to accept. If the borrower accepts the offer, it will be required to complete necessary documentation before availing the loan
  • The additional loans that are proposed to be provided by HHFL are governed by the Operational Guidelines on the Emergency Credit Line Guarantee Scheme (“Scheme”) issued by National Credit Guarantee Trustee Company (“NCGTC”) and is subject to change from time to time. The terms and conditions of the loan may be modified, varied or supplemented by HHFL from time to time in view of any changes to the Scheme by NCGTC and HHFL shall not be held liable for the same.

In case of any queries, please reach out to us at our tollfree number 1800-212-8800

To know more about the scheme, click here.

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