The Reserve Bank of India (RBI) has revised its Priority Sector Lending (PSL) guidelines, effective from April 1, 2025. The updated norms aim to improve access to credit for priority sectors such as agriculture, MSMEs, renewable energy, education, and social infrastructure. These changes focus on increasing loan limits, expanding the ‘Weaker Sections’ category, and updating PSL targets for urban cooperative banks (UCBs).

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• RBI’s updated PSL guidelines take effect from April 1, 2025, focusing on credit accessibility for key sectors.
• Education loans have a new limit of ₹25 lakh per individual, including for vocational courses.
• Social infrastructure loans can now go up to ₹8 crore per borrower for setting up schools, water facilities, etc.
• Housing loans will be classified based on population size, with limits of ₹50 lakh (large cities), ₹45 lakh (medium-sized cities), and ₹35 lakh (smaller cities).
• Renewable energy loans have been increased, with limits up to ₹35 crore for public utilities and ₹10 lakh for individual households.
• The PSL target for urban cooperative banks (UCBs) is set at 60% of ANBC (Adjusted Net Bank Credit).
• Urban cooperative banks must allocate 7.5% of their PSL to micro enterprises and 12% to weaker sections.
• The definition of ‘Weaker Sections’ now includes transgenders, artisans, and women beneficiaries up to ₹2 lakh.
• Weaker Sections now also include small and marginal farmers, distressed farmers, SC/STs, persons with disabilities, and minority communities.
• The new PSL norms are designed to enhance financial inclusion and promote economic growth in critical areas like education, housing, and renewable energy.