The Reserve Bank of India (RBI) has, revised its guideline on Priority Sector Lending (PSL) on 20.07.2012. The details of important changes in the activities included in the revised Priority Sector Lending guidelines are as under:
• Overall target under priority sector is retained at 40 per cent. The targets for both direct and indirect agricultural lending are kept unchanged at 13.5 per cent and 4.5 per cent of Adjusted Net Bank Credit, respectively.
• Loans to Micro and Small Service enterprises up-to- Rs. 1 crore and all loans to Micro and Small Manufacturing Enterprises.
• Loans upto Rs. 25 lakh for housing in metropolitan centres of population above 10 lakh and Rs. 15 lakh at other centres.
• Loans to Food and Agro processing units.
• Loans to individuals for educational purposes including for vocational courses upto Rs. 10 lakh in India and Rs. 20 lakh abroad.
• Loans for housing projects exclusively for economically weaker sections and low income groups provided the cost does not exceed Rs. 5 lakh per dwelling unit.
• Loans to distressed farmers indebted to non-institutional lenders.
• Overdrafts upto Rs. 50000/- in No-Frills account.
• Loans to State Sponsored Organizations for scheduled castes and scheduled tribes.
• Loans to individuals for setting up of off-grid solar and other off-grid renewable energy solutions for households.
• Loans to individuals other than farmers upto Rs. 50000/- to prepay their debt to non-institutional lenders.
• Foreign banks having 20 or more branches in the country have been brought on par with domestic banks for priority sector targets in a phased manner over a maximum period of 5 years starting April 1, 2013.
• The foreign banks with less than 20 branches will have no sub targets within the overall priority sector lending target of 32 per cent.
• Bank loans to Primary Agricultural Credit Societies (PACS), Farmers’ Service Societies (FSS) & Large Adivasi Multi-Purpose Co-operative Societies (LAMPS) ceded to or managed/controlled by such banks for on-lending to farmers for agricultural and allied activities are included under direct agriculture.
The revised guidelines are available on the website of RBI at www.rbi.org.in.