Priority Sector Lending- RBI revised the lending limits for Start-ups.

Friends, in midst of the pandemic, RBI has revised the Priority sector to enable better credit penetration to credit deficient areas; increase the lending to small and marginal farmers and weaker sections; boost credit to renewable energy, and health infrastructure.

The details of the revised guidelines are as below:

 

Bank finance to start-ups (up to ₹50 crore); loans to farmers for installation of solar power plants for solarisation of grid connected agriculture pumps and loans for setting up Compressed Bio Gas (CBG) plants have been included as fresh categories eligible for finance under priority sector. Some of the salient features of revised PSL guidelines are: 

1) To address regional disparities in the flow of priority sector credit, higher weightage have been assigned to incremental priority sector credit in ‘identified districts’ where priority sector credit flow is comparatively low. 

2) The targets prescribed for “small and marginal farmers” and “weaker sections” are being increased in a phased manner. 

3) Higher credit limit has been specified for Farmers Producers Organizations (FPOs)/Farmers Producers Companies (FPCs) undertaking farming with assured marketing of their produce at a predetermined price. 

4) Loan limits for renewable energy have been increased (doubled).

 5) For improvement of health infrastructure, credit limit for health infrastructure (including those under ‘Ayushman Bharat’) has been doubled.