Question
Consider the following regarding Priority Sector Lending
(PSL): 1. Export credit is considered a category under PSL. 2. Loans to MSMEs for activities like retail trade are excluded from PSL. 3. If a bank fails to meet the PSL target, the shortfall is deposited in the Rural Infrastructure Development Fund (RIDF). Which of the statements above is/are correct?ÂSolution
Statement 2 is incorrect. Retail trade loans to MSMEs (up to a certain limit) are now included under the PSL category.
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