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Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the bank's operations.
Q. Which of the following statement(s) is/are incorrect about Priority sector lending?
(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector
(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector
(iii) Loans for educational purposes are not considered under Priority Sector
(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sector
  • a)
    Only ii, and iv
  • b)
    Only ii, iii, and iv
  • c)
    Only i, iii, and iv
  • d)
    All of the above-mentioned statements are incorrect
Correct answer is option 'C'. Can you explain this answer?
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Verified Answer
Direction: Priority sector advances refer to loans provided by banks t...
Loans for the purchase, construction, and repairs of a dwelling unit are part of the Housing category, rather than the social infrastructure category. Also, educational purposes are considered under the priority sector lending. The loans to start-ups engaged in activities other than Agriculture or MSME are part of the others category of the priority sector.
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Direction: Priority sector advances refer to loans provided by banks t...
Understanding Priority Sector Lending Statements
Priority sector lending (PSL) in India focuses on providing loans to sectors that significantly contribute to the economy's growth and development. Let's analyze the given statements regarding PSL to clarify the incorrect ones.
Statement Analysis
- (i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector.
- Explanation: This statement is incorrect. Loans for housing are categorized under the "Housing" segment, not specifically under social infrastructure.
- (ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector.
- Explanation: This statement is correct. Loans to such farmers are indeed included in the Weaker Sections category, aiming to assist those in dire financial need.
- (iii) Loans for educational purposes are not considered under Priority Sector.
- Explanation: This statement is incorrect. Loans for educational purposes, including student loans, are recognized under the priority sector lending guidelines.
- (iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sector.
- Explanation: This statement is incorrect. Start-ups in agriculture and MSMEs are categorized under specific priority sectors, not lumped into an "Others" category.
Conclusion
Given the analysis:
- Statements i, iii, and iv are incorrect, making option c the correct choice.
Understanding these distinctions is crucial for compliance with the Reserve Bank of India's guidelines on priority sector advances.
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Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer?
Question Description
Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer? for Bank Exams 2025 is part of Bank Exams preparation. The Question and answers have been prepared according to the Bank Exams exam syllabus. Information about Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for Bank Exams 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer?.
Solutions for Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for Bank Exams. Download more important topics, notes, lectures and mock test series for Bank Exams Exam by signing up for free.
Here you can find the meaning of Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer?, a detailed solution for Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer? has been provided alongside types of Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Direction: Priority sector advances refer to loans provided by banks to certain sectors of the economy identified as priority areas for development by the government. Banks in India must allocate a certain percentage of their total lending to these sectors. Priority sector lending is an important tool for promoting inclusive growth and reducing inequality by providing credit to underserved segments of the economy. Banks are required to comply with the priority sector lending targets and report their progress to the RBI regularly. Failure to meet these targets can result in penalties and restrictions on the banks operations.Q. Which of the following statement(s) is/are incorrect about Priority sector lending?(i) Loans for the purchase, construction, and repairs of a dwelling unit are included in the social infrastructure category of the priority sector(ii) Loans to distressed farmers indebted to non-institutional lenders are part of the Weaker Sections category of the priority sector(iii) Loans for educational purposes are not considered under Priority Sector(iv) Loans to start-ups engaged only in Agriculture or MSME activities are included in the Others category of the priority sectora)Only ii, and ivb)Only ii, iii, and ivc)Only i, iii, and ivd)All of the above-mentioned statements are incorrectCorrect answer is option 'C'. Can you explain this answer? tests, examples and also practice Bank Exams tests.
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