RBI Brings Loans To Startups Under Priority Sector Lending; Startups Can Now Avail Loans Of Up To Rs 50 Crore

In a roaring push for the nation's startups, the Governor Shaktikanta Das led Reserve Bank of India (RBI) on Friday (4 August) brought the financing of startups under priority sector lending (PSL) category, reports Indian Express.

As per the policy update, startups engaged in activities other than agriculture or micro, small and medium enterprises will now be able able to avail loans of up to Rs 50 crore.

The startups are likely to gain in the form of greater and easier access to funds, given the commercial banks, including foreign ones are required to mandatorily earmark 40 per cent of the adjusted net bank credit for PSL activity.

Furthermore, regional rural banks and small finance banks will have to now allocate 75 per cent of their adjusted net bank credit for PSL.

Apart from this, the RBI also announced varied other reviewed guidelines to align the PSL of banks with emerging national priorities. RBI said that it has attempted to bring a sharper focus on inclusive development, after having wide-ranging discussions with all stakeholders.

Along with startups, the new guidelines will also benefit small and marginal farmers and weaker sections, and the renewable energy and health infrastructure sectors. As per RBI, new PSL norms will enable better credit penetration to credit deficient areas.