RBI/2004-2005/237
RPCD.PLNFS.BC. No. 44/06.11.01/2004-05
October 26, 2004
The Chairman/Managing Director
All Scheduled Commercial Banks (Including RRBs & Local Area Banks)
Dear Sir,
Priority Sector Lending - Housing Loan: Enhancement
of ceiling
Please refer to paragraph 3.7.1
of Section I of the Master Circular
RPCD.No.Plan.BC.
7/04.09.01/2004-05 dated July 20, 2004
on lending to priority sector in terms of which bank loans up to Rs. 10 lakh
for construction of houses by individuals, excluding loans granted by banks
to their own employees are reckoned under priority sector advances.
2. In this connection, please refer to paragraph
83 of the Mid-Term
Review of Annual Policy Statement for the year 2004-05 dated October 26, 2004
(copy of the paragraph enclosed). In order to further improve flow of credit
to the housing sector, it has been decided that banks, with the approval of
their Boards, may extend direct finance to housing sector up to Rs. 15 lakh
irrespective of location, as part of their priority sector lending.
3. We shall be glad if you please issue necessary
instructions to your controlling offices/branches in the matter for appropriate
action.
4. Please acknowledge receipt.
Yours faithfully,
(G. Srinivasan)
Chief General Manager
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