Current Affairs PDF Sales

RBI revises norms for priority sector lending

AffairsCloud YouTube Channel - Click Here

AffairsCloud APP Click Here

India’s leading bank,Reserve Bank Of India,on thursday 23rd April 2015,had revised the priority sector lending norms that directs banks to lend certain division by prescribing targets as a percentage. The main goal behind this is to boost credit flow to farmers, exports,education, small firms etc.
  • All the banks have to lend atleast 40% of their net credit to priority sector.
  • Those foreign banks  with less than 20 branches would touch the target by 2020 and those foreign banks with more than 20 branches already have priority sector targets and sub-targets for agriculture and other weaker sections.
  • New norms require banks to ensure that 8% of their loans go to small farmers etc
  • RBI has asked banks to achieve this in phased way like 7% by March 2016 and 7.5% by March 2017
  • Loan limits for housing loans and MFI loans under priority sector have also been revised.
  • To achieve these targets, RBI would  release some guidelines for priority sector and these guidelines would give banks some freedom to achieve their priority sector targets.
  • Bank loans to food  and other agro processing units would form a part of agriculture and export credit upto 32% will be eligible as part of priority sector for foreign banks .
  • For other banks it would be upto 2%.
                                         ABOUT RESERVE BANK OF INDIA
  • It is India’s Central Banking institution that controls Monetary Policy of Indian Rupee.
  • RBI was formed in  April 1 in the year 1935 and has headquarters in Mumbai,Maharashtra
  • Its current governor is Mr.Raghuram Rajan.
  • RBI has 4 zonal offices and 19 regional offices all over India.
  • It has got training colleges for officers  at Chennai and Pune.
  • Other zonal training centres are in Mumbai, Delhi and Kolkata and Chennai.