RBI issues revised priority sector lending guidelines.

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The Reserve Bank of India vide its notification dated 4th September 2020 has published the revised Priority Sector Lending Guidelines to align it with emerging national priorities. The new guidelines will enable better credit penetration into credit deficient areas and increase lending to small as well as marginal farmers and weaker sections. It will also enhance credit to renewable energy, and health infrastructure.

The revised guidelines have been framed to address regional disparities in the flow of priority sector credit and higher weightage have been assigned to incremental priority sector credit in ‘identified districts’ where priority sector credit flow is comparatively low.

Under revised guidelines, the higher credit limit has been specified for Farmers Producers Organisations (FPOs)/Farmers Producers Companies (FPCs) undertaking farming with assured marketing of their produce at a pre-determined price.

Further, the targets prescribed for “small and marginal farmers” and “weaker sections” are being increased in a phased manner and the loan limits for renewable energy have been doubled.

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