Q1. Consider the following statements regarding the Emergency Credit Linked Guarantee Scheme (ECLGS) 5.0:
- It seeks to facilitate credit by providing a guarantee that reduces the lender’s credit risk.
- The National Credit Guarantee Trustee Company is associated with implementation of the scheme.
- Guarantees under ECLGS 5.0 can continue to be issued beyond the sanctioned guarantee cover if eligible borrowers remain.
- Allocation of the available guarantee cover under the scheme follows a first-come, first-served approach.
Which of the statements given above are correct?
(a) 1, 2 and 4 only
(b) 1 and 3 only
(c) 2, 3 and 4 only
(d) 1, 2, 3 and 4
Answer: (a)
Explanation
- Statement 1 — Correct: ECLGS is a credit guarantee mechanism. The government-backed guarantee reduces the lender’s risk, encouraging credit flow to eligible borrowers.
- Statement 2 — Correct: NCGTC is the implementing/guarantee agency associated with ECLGS.
- Statement 3 — Incorrect: ECLGS 5.0 is restricted by its ₹2.5 lakh crore guarantee cover. Sanctions beyond the available cover are not admissible.
- Statement 4 — Correct: The available guarantee cover is allocated on a first-come, first-served basis.
