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Below is Perspective on Finance Minister's Announcement on Relief Measures by the Finance Minister By Mr. Vikash Khandelwal, CEO, Eqaro Guarantees

“Guarantees are an efficient way to facilitate funding for businesses. It improves lender confidence and supports easier access to credit without locking in collaterals.

The government enhancing the limits from Rs 3 lakh crore to Rs 4.5 lakh crore under the ECLGS program is an enabling mechanism that will help infuse liquidity in a number of industries. MSMEs are the backbone of the Indian economy. The enhanced credit line for MSMEs and MFIs will ensure the availability of funding for small and unorganized businesses which have been severely impacted due to the pandemic.

The measures for the healthcare infra sector will help fight the pandemic, improve the rate of vaccination, thereby result in faster unlocking of the economy.

Banks have become risk-averse due to the second wave of the pandemic which is reflecting in the credit-deposit ratio which is at a 4-year low. The enhanced ECLGS limit will encourage banks to lend more thus enabling credit delivery, aid economic recovery, generate employment, and revive demand.”

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