According to a latest update from the Reserve Bank Of India, in order to boost credit to export sector, it has been decided to effect following changes in para 8 of the "Master Direction on Priority Sector Lending (PSL)-targets and Classification" dated July 7, 2016 (updated as on December 4, 2018) pertaining to export credit.

The central bank stated that it has been decided to enhance the sanctioned limit, for classification of export credit under PSL, from Rs 25 crore per borrower to Rs 40 crore per borrower. The bank has also decided to remove the existing criteria of 'units having turnover of up to Rs 100 crore.

The existing guidelines for domestic scheduled commercial banks to classify 'Incremental export credit over corresponding date of the preceding year, upto 2% of ANBC or Credit Equivalent Amount of Off-Balance Sheet Exposure, whichever is higher' under PSL will continue to be applicable subject to the criteria mentioned above. There is no change in the present instructions in respect of foreign banks.

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Published On : 23-09-2019

Source : Business Standard