State-run Bank of Baroda on Saturday said it can offer up to Rs 12,000 crore in loans to MSMEs under the Rs 3 lakh crore Emergency Credit Line Guarantee Scheme (ECLGS) announced by the government.

Last week, Finance Minister Nirmala Sitharaman had announced a 100 per cent credit guarantee scheme worth Rs 3 lakh crore to support the medium, small and micro enterprises (MSMEs) which have been adversely affected by the coronavirus crisis.

All existing MSME borrowers with outstanding credit of up to Rs 25 crore as on February 29 and with an annual turnover of up to Rs 100 crore would be eligible for funding under the scheme.

“In our case, that particular portfolio amounts to be Rs 58,000 crore. So, 20 per cent of that would be around Rs 10,000 crore to Rs 12,000 crore. This, we can make available to our MSME clients in the times to come under the guaranteed scheme of the government,” the bank’s Managing Director and CEO Sanjiv Chadha told reporters through a video conference.

The ECLGS was the second-biggest component of the over Rs 20 lakh crore comprehensive package announced by the government for the coronavirus-hit economy.

Under the scheme, 100 per cent guarantee coverage will be provided by the National Credit Guarantee Trustee Company (NCGTC) for additional funding of up to Rs 3 lakh crore to eligible MSMEs and interested Mudra scheme borrowers, in the form of a guaranteed emergency credit line (GECL) facility.

The amount of GECL funding to eligible MSME borrowers, either in the form of additional working capital term loans (in case of banks and financial institutions) or additional term loans (in case of NBFCs), would be up to 20 per cent of their entire outstanding credit of up to Rs 25 crore as on February 29, 2020.

Chadha further said under the COVID-19 emergency credit line launched in March, the bank has so far sanctioned Rs 3,000 crore in loans and disbursed Rs 1,500 crore to MSMEs.

Nearly, 60-70 per cent of the bank’s borrowers have availed the three-month moratorium on repayment of term loans announced in March by the RBI.

“In terms of people availing the moratorium, it was around 60-70 per cent, although 90 per cent or more would have been eligible for that,” he said.

On Friday, State Bank of India Chairman Rajnish Kumar had said close to 20 per cent of the bank’s borrowers had availed moratorium on repayment of term loan instalments.

The RBI on Friday extended the moratorium for another three months to August 31, 2020.

Chadha sees the number of people availing moratorium declining going forward as economic activities resume.

The bank has not offered a moratorium to NBFCs but is now considering granting them the facility on a case-to-case basis, he said.

“That (moratorium to NBFCs) is something which is being considered by us. We are clear that regardless of the category of borrowers, whether an NBFC, an industrial borrower, MSME or home loan borrowers, you do need to address what are very genuine requirements at this point of time,” he said.

“Therefore, when it comes to our NBFC borrowers, particularly the smaller ones where dependence on some banks would be little more, and where access to alternative sources of funding is not available, it (offering moratorium) becomes a simpler decision,” Chadha said.

According to him, the bank is well capitalised currently but may look to raise tier-1 capital to build its capital buffer.

“In terms of the equity market, it is not the best time. But we could be in the market for possibly tier-1 capital over the next two months,” he added.