Government-Backed Credit Scheme Helps Firms Tackle External Shocks
What Happened
The government’s Emergency Credit Line Guarantee Scheme (ECLGS) 5.0 is providing additional working capital support to businesses affected by global disruptions, including supply-chain challenges and rising logistics costs. The scheme aims to facilitate up to ₹2.55 lakh crore in additional credit through government-backed guarantees.
Key Takeaways
MSMEs have emerged as the biggest beneficiaries of the scheme. As of August 20, 2026, over 6.7 lakh guarantees worth about ₹2.5 lakh crore had been issued, with small businesses accounting for the overwhelming majority of guarantees. The scheme is designed to improve liquidity, support employment and help companies maintain operations during periods of economic stress.