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Priority to start-ups in bank credit: RBI

by BQ News Bureau
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The Reserve Bank of India has comprehensively reviewed the Priority Sector Lending (PSL) guidelines to align them with emerging national priorities and bring a sharper focus on inclusive development.

Revised PSL guidelines will 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.

Bank finance to start-ups (up to Rs.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.

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

Targets prescribed for “small and marginal farmers” and “weaker sections” are being increased in a phased manner.

Higher credit limit has been specified for Farmers Producers Organisations (FPOs)/Farmers Producers Companies (FPCs) undertaking farming with assured marketing at a pre-determined price.

Loan limits for renewable energy have been doubled. The credit limit for health infrastructure, including those under ‘Ayushman Bharat,’ has been doubled.

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