To boost credit supply to small exporters,the Reserve Bank of India(RBI) has enhanced the loan sanctions limit under priority sector lending by banks to Rs 40 crore per borrower.Earlier,the limit was capped at Rs 25 crore per borrower.The RBI has also decided to remove the existing criteria of’units having turnover of up to Rs 100 crore1 as part of the changes.The changes have been done”to boost credit to the export sector”,the central bank said in the notification.Priority sector lending is a mandatory requirement under which the banks are mandated to devote a portion of their advances to empower focused groups of the economy.All sectors put together,this adds up to 42 percent of the total lending for each bank.
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