Module: General Practice
Q17: Under the Reserve Bank of India’s Priority Sector Lending (PSL) guidelines (Master Directions updated 2025), what is the mandatory sub-target for lending to Micro Enterprises for Domestic Commercial Banks?
✅ Correct Answer: B
For Domestic Scheduled Commercial Banks, the specific sub-target for Micro Enterprises is 7.5% of Adjusted Net Bank Credit (ANBC) or Credit Equivalent Amount of Off-Balance Sheet Exposure (CEOBE), whichever is higher.
While the total Priority Sector target is 40%, this specific sub-target ensures that the smallest businesses (Micro) are not ignored in favor of larger "Small" or "Medium" enterprises.
Note that Small Finance Banks (SFBs) have different overall targets but similar focus on micro-lending.
While the total Priority Sector target is 40%, this specific sub-target ensures that the smallest businesses (Micro) are not ignored in favor of larger "Small" or "Medium" enterprises.
Note that Small Finance Banks (SFBs) have different overall targets but similar focus on micro-lending.