RBI PSL Rule 2025: The Reserve Bank of India has announced major changes in the priority sector loan (PSL) rules. The new rule will be applicable from April 1, 2025. These guidelines have been prepared on the basis of comprehensive review of existing provisions and feedback received from the concerned stakeholders. This change will promote MSME, agriculture, renewable energy, affordable housing and loan to weaker sections.
Changes in PSL Rules
1. Increase in loans limits including housing loans with a view to increase coverage of priority sector loan
2. Expansion of criteria to classify loans in renewable category
3. The total PSL target for urban cooperative banks has been revised and 60%of their audited net bank loan and off-balance sheet exposure, whichever is higher.
4. Along with increasing the number of eligible borrowers under the weaker section category, the maximum limit of loan given by UCB to individual women beneficiaries has been increased.
Housing credit increase
The RBI has made significant amendments to the housing loan limit and the price of the house in the revised guidelines. While the first two categories were there, now the RBI has set three categories for housing loans under the priority sector loan (PSL). This step will promote low cost/affordable housing in various income groups, especially Tier-IV/V/VI cities.
Increase in credit limit for repair operations
RBI has now increased the loan limit available for repairing old or dilapidated houses. The move will open new opportunities for banks and other financial institutions to distribute loans in safe and specific sectors. Additionally, this will also reduce the financial stress of the landlords.
Renewable energy
Debt limit for renewable energy projects Rs. Is 10 lakhs. Increased from rupee to Rs. 30 crores to Rs. A provision of Rs 35 crore has been made. The loan limit will be only Rs 10 lakh as before. Its price will be 10 lakhs. This step will help India meet 500 GW non-Givash fuels by 2030 and its target of pure zero by 2070.
On 1 July 2015, RBI expanded the scope of priority sector loan. For loan holders Rs. Loans up to Rs 15 crore have been approved. This includes actions such as solar energy generators, biomass based generators, micro-hydral plants and non-traditional energy (NCE)-based street lights and public light replacement.
Big relief for weaker sections, farmers and urban cooperative banks
As per the changes made by the RBI in the priority sector loan (PSL) guidelines, the loan limit for artisans and women beneficiaries has been increased to Rs 2.5 lakh. It has been increased from Rs 100 to Rs 150. 1 lakh to Rs. 2 lakhs Additionally, members of the Transgender and Joint Liability Group (JLG) have also now been included in the eligibility of PSL. The agricultural sector has also been given great relief – the loan limit has been increased to Rs 5 lakh on the warehouse receipt. 4 crore rupees, while the loan limit for farmer producing organizations (FPO/FPC) increased to Rs. Increased from 5 crores to Rs. A provision of Rs 10 crore has been made. In addition, the PSL target for urban cooperative banks (UCB) has been reduced from 75% to 60%.
