RULAR BANKING MODULE C QUIZ 2

Agriculture is a PSL category. Other recognised categories include MSMEs, export credit, education, housing, social infrastructure, renewable energy and others as specified by RBI.

The standard micro-enterprises sub-target is 7.5% of ANBC or the credit equivalent of off-balance-sheet exposure, whichever is higher.

PSL classification depends on the specific category criteria and applicable limits/conditions, not merely on branch location or loan size.

RBI includes eligible export credit within the PSL framework subject to prescribed borrower, sector and exposure conditions.

Good programme design includes transparent eligibility, effective delivery, monitoring and grievance redress so that assistance reaches intended beneficiaries.

PMAY-G beneficiary selection follows prescribed eligibility, deprivation and verification processes; banks should not assume a person qualifies solely by applying.

DBT seeks to deliver eligible benefits directly to identified beneficiaries, often through bank accounts and digital payment rails, improving transparency and reducing leakage.

Where permitted by applicable instructions, restructuring can provide a realistic repayment schedule after production or income disruption while preserving proper loan classification and documentation.

PSL housing classification is conditional on current RBI limits and criteria. Location alone or borrower preference cannot override eligibility requirements.

Eligible crop production credit is ordinarily assessed within agriculture. Non-farm enterprises may instead fall under MSME or another category depending on their activity and applicable rules.

Education loans are eligible only within the category‘s prescribed criteria. A loan exceeding the applicable PSL conditions may still be a valid bank loan but not qualify as PSL.

Access alone is insufficient. Usage, activity, affordability and suitability help measure meaningful financial inclusion.

Documented assessment supports consistent, auditable relief decisions and helps ensure measures are applied under the correct instructions.

Weaker-sections classification is based on specified categories and conditions. Banks should verify eligibility using current directions and suitable records.

The activity may be classified under MSME if it meets current MSME and PSL criteria; rural location alone does not determine the category.

Credit counselling supports informed borrowing and debt management. It should not encourage over-borrowing or promise approval.

The economic purpose alone does not override category-specific limits and eligibility rules. The bank should apply current RBI directions.

Scheme eligibility does not replace normal appraisal. Repayment, title/security where relevant, construction progress and policy requirements remain important.

Application volume is an activity measure. Impact should be assessed through outcomes such as income, resilience, employment and service usage.

Errors should be corrected transparently with appropriate reporting and control improvements; retaining incorrect classification creates compliance risk.