A day after Prime Minister Narendra Modi announced monetary measures worth Rs. 20 lakh crore amid nationwide COVID-19 lockdown, Union Finance Minister Nirmala Sitharaman on Wednesday informed Rs. 3 lakh crore collateral-free automatic loans for businesses, including MSMEs.
The Finance Minister said that borrowers with up to Rs. 25 crore outstanding and Rs. 100 crore turnover will be eligible for these. The loans will have a four year tenor with a moratorium of 12 months on principal payment, while interest will be capped, she added.
“100 percent credit guarantee cover to banks and NBFCs on principal and interest. The scheme can be availed till October 31, 2020. 45 lakh units can resume business activity and safeguard jobs,” the Finance Minister said, while addressing the media.
She also stated that to provide stressed MSMEs with equity support, the government will facilitate the provision of Rs. 20,000 crore as subordinate debt.
“Prime Minister laid out a comprehensive vision, and that vision was laid out after wide consultations with several sections of the society… Essentially this is to spur growth and to build a very self reliant India and that is why this whole initiative is called Atmanirbhar Bharat Abhiyan,” Sitharaman said.
“Atmanirbhar (self-reliant) India does not mean India is to be an isolationist country,” she added.
It may be mentioned that beginning today, over the next few days the Union Finance Minister along with the team will address media to put forth Prime Minister’s vision.