Inko toh LOAN dena hi padega kyunki BOSS (RBI) ka nirdesh hai-PRIORITY SECTOR LENDINGDear readers, today we are providing you the highlights of the one of the most important topic of General awarenesssection, i.e. the Priority Sector Lending.It is very relevant for all the upcoming banking exams, IBPS/SBI/RRB etc. and also being asked in the banking interviews.

Highlights of PSL

It means provide credit to the needy sectors of the society. The sectors are: Agriculture Micro and Small Enterprises Education Housing Export Weaker Sections Social Infrastructure Renewable Energy

Targets under PSLAgriculture: 18 percent of ANBC. Out of this 18 percent, a target of 8 percent of ANBC is for Small and Marginal Farmers, to be achieved in a phased manner i.e., 7 per cent by March 2016 and 8 per cent by March 2017.Weaker Sections: 10 percent of ANBC.Micro Enterprises: 7.5 percent of ANBC has been prescribed for Micro Enterprises, to be achieved in a phased manner i.e. 7 percent by March 2016 and 7.5 percent by March 2017.Overall PSLTarget for Domestic Bank/Foreign Bank with more than 20 Branches: 40 percent of Adjusted Net Bank Credit. Overall PSL Target forForeign Bank with less than 20 Branches:40 percent of Adjusted Net Bank Credit to be achieved in a phased manner-2015-1632

2016-1734

2017-1836

2018-1938

2019-2040

Categorization of MSME according to MSME ACT 2006

Manufacturing Sector (Goods)

EnterprisesInvestment in plant and machinery

Micro EnterprisesDoes not exceed twenty five lakh rupees

Small EnterprisesMore than twenty five lakh rupees but does not exceed five crore rupees

Medium EnterprisesMore than five crore rupees but does not exceed ten crore rupees

Service Sector

EnterprisesInvestment in equipment

Micro EnterprisesDoes not exceed ten lakh rupees

Small EnterprisesMore than ten lakh rupees but does not exceed two crore rupees

Medium EnterprisesMore than two crore rupees but does not exceed five crore rupees

Other Facts:

Farmers with landholding of up to 1 hectare are considered as Marginal Farmers. Farmers with a landholding of more than 1 hectare and upto 2 hectares are considered as Small Farmers. Scheduled Commercial Banks having any shortfall in lending to priority sector shall be allocated amounts for contribution to the Rural Infrastructure Development Fund (RIDF) established with NABARD. For Renewable Energy, bank loans up to a limit of Rs.15 crore to borrowers for purposes like solar based power generators, etc. For individual households, the loan limit will be Rs.10 lakh per borrower. For Housing, banks can provide loans to individuals up to Rs. 28 lakh in metropolitan centres (with population of ten lakh and above) and loans up to Rs. 20 lakh in other centres for purchase/construction of a dwelling unit per family. Export credit will be allowed up to 32 percent of ANBC for Foreign banks with less than 20 branches in India. For Education, banks can provide loans to individuals for educational purposes including vocational courses upto Rs. 10 lakh for studies in India and Rs. 20 lakh for studies abroad.

Read more:http://www.bankersadda.com/2015/06/inko-toh-loan-dena-hi-padega-kyunki.html#ixzz3cAEKDVBs

Adjusted Net Bank Credit = Net Bank Credit + permitted Non SLR invstmnts (Held Till Maturity HTM category) + Other Invstmnts eligible to be treated as priority sector.

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