RBI Relaxes Capital Norms for ECLGS 5.0 Loans, Allows Zero Risk Weight on 75% of Guaranteed Portion
The RBI has relaxed capital requirements for bank loans backed by the Emergency Credit Line Guarantee Scheme (ECLGS 5.0), effective immediately.
Under the revised norms, 75% of the guaranteed portion of the loan attracts a zero-risk weight, while the remaining 25% of the exposure attracts a 20% risk weight. To qualify for the 0% risk weight, banks must settle claims within 30 days from the date of invocation.