Banking · Priority Sector Lending Guidelines
An urban cooperative bank is considering lending to various sectors to meet its growing Priority Sector Lending (PSL) obligations, which are being increased in a phased manner by the Reserve Bank of India. The bank has a customer who is a large-scale housing developer seeking a loan of 100 crore rupees for a project that includes a mix of luxury and affordable housing units in a Tier 1 city. Additionally, a local primary school wants 2 crore rupees for a new laboratory, and a group of 10 farmers wants 15 lakh rupees each for purchasing specialized harvesting equipment. The bank's management is particularly concerned about the 'Weaker Sections' target and wants to know which of these loans will help them achieve that specific sub-target.
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1None of the above loans fall under the Weaker Sections category.
- 2The loans to the 10 farmers, provided they are categorized as small and marginal farmers.✓
- 3The school's loan as it falls under social infrastructure.
- 4The housing developer's loan as it includes affordable housing.
Correct answer
The loans to the 10 farmers, provided they are categorized as small and marginal farmers.
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