Banking · Priority Sector Lending Guidelines
A domestic bank is evaluating three lending proposals of ₹500 crore each to maximize its 'Weaker Sections' sub-target under Priority Sector Lending guidelines: Case A: Lending ₹500 crore to Micro-MFIs for on-lending to small and marginal farmers. Case B: Lending ₹500 crore to individual homebuyers in a Tier 2 city with an average loan size of ₹20 lakh. Case C: Investing ₹500 crore in Securitised Assets (PTCs) backed 100% by underlying micro-enterprise loans. Which case provides the highest contribution toward the 'Weaker Sections' sub-target?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Cases A and C are equal.✓
- 2Case C
- 3Case B
- 4Case A
Correct answer
Cases A and C are equal.
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