The Reserve Bank of India has issued a master circular consolidating its existing instructions to all scheduled commercial banks, including small finance banks, on increasing credit to Scheduled Caste and Scheduled Tribe borrowers. Banks must give these communities greater weight in district and block credit planning, provide application support, promote awareness of available schemes and focus on areas with sizeable Scheduled Caste and Scheduled Tribe populations. Banks must not require deposits under government sponsored poverty alleviation and self-employment programs or withhold applicable subsidies until loans are repaid. Rejections under government programs require approval at the next higher level and documented reasons. The circular also restates targeted support under major schemes, including a minimum 40% share of Differential Rate of Interest advances for eligible Scheduled Caste and Scheduled Tribe borrowers and guarantee cover of INR 0.15 crore to INR 5 crore for eligible Scheduled Caste enterprises under the Credit Enhancement Guarantee Scheme for Scheduled Castes. Each bank must maintain a head office cell to monitor credit flows, conduct quarterly reviews and escalate major year over year gaps or variations to its board or delegated committee. Advances must be reported under the Reserve Bank of India’s priority sector lending framework within the prescribed timeframes.
Reserve Bank of India consolidates requirements for bank credit facilities to Scheduled Castes and Scheduled Tribes
The Reserve Bank of India has consolidated its instructions to scheduled commercial banks on expanding credit to Scheduled Caste and Scheduled Tribe borrowers. Banks must support applicants, avoid deposits and delayed subsidies under specified government programs, subject rejections to higher level review and monitor credit flows quarterly. Reporting remains linked to the priority sector lending framework.