RBI said loans to corporates including farmers' producer companies of individual farmers, partnership firms and co-operatives of farmers directly engaged in Agriculture and Allied Activities, up to an aggregate limit of Rs 2 crore per borrower.
Incase, if the aggregate loan limit per borrower is more than Rs 2 crore, the entire loan should be treated as indirect finance to agriculture, it added.
Bank loans to Micro and Small Enterprises (MSE) engaged in providing or rendering of services will be eligible for classification as direct finance to MSE Sector under priority sector upto an aggregate loan limit of 2 crore per borrower/unit, provided they satisfy the investment criteria. 3
Also, loans to any governmental agency for construction of dwelling units or for slum clearance and rehabilitation of slum dwellers subject to a ceiling of Rs10 lakh per dwelling unit, the RBI said.
" Bank loans to Housing Finance Companies (HFCs), approved by NHB for their refinance, for on-lending for the purpose of purchase/construction/reconstruction of individual dwelling units or for slum clearance and rehabilitation of slum dwellers, subject to an aggregate loan limit of Rs 10 lakh per borrower, provided the all inclusive interest rate charged to the ultimate borrower is not exceeding lowest lending rate of the lending bank for housing loans plus two percent per annum, RBI said in the notification.
The RBI also clarified that the investments in non-SLR securities, under HTM category for computation of ANBC will include only non-SLR bonds/debentures. Off-balance sheet interbank exposures are excluded for computing Credit Equivalent of Off -Balance Sheet Exposures for the priority sector targets.The term "all inclusive interest" includes interest (effective annual interest), processing fees and service charges.
The RBI made a point that banks should ensure that loans extended under priority sector are for approved purposes and the end use is continuously monitored.