Priority Sector Lending: Weaker Sections List Updated
Current · Source: Reserve Bank of India · RBI/2007-2008/159 · issued 11 Oct 2007 · ~1 min read
Quick answerRBI replaces Sikkim with Meghalaya in the list of states where a minority community is in majority for priority sector lending to weaker sections. This correction applies to all scheduled commercial banks except RRBs.
The rule, in the simplest words
Banks must update their list of states with minority communities in majority for [priority sector lending (lending to important sectors like farming or small businesses)]
Meghalaya is now included in the list instead of Sikkim for [weaker sections (people who need extra support)]
This change applies to all [scheduled commercial banks (normal banks, not rural banks)] except [Regional Rural Banks (banks that focus on rural areas)]
Banks need to update their records and train staff to ensure correct [lending (giving loans)] to weaker sections
How it plays out — a real example
A priority sector lending officer in Mumbai will now make sure to update their records to reflect Meghalaya instead of Sikkim when identifying weaker sections for loan eligibility. This means they will correctly target loans to minority communities in Meghalaya, ensuring the bank's lending practices align with the updated guidelines. By doing so, the officer will help the bank avoid misclassification of priority sector advances and ensure compliance with the RBI's rules.
What changed
The earlier circular dated May 18, 2007 had added a clause (j) under paragraph 8 of Section I of the priority sector lending guidelines. Now, in partial modification, the state of Sikkim is substituted by Meghalaya in the list of states where one minority community is in majority.
What it means for you
Banks must update their internal records and lending guidelines to reflect Meghalaya instead of Sikkim for identifying weaker sections under priority sector lending. This ensures correct targeting of loans to minority communities in states where they form a majority. Non-compliance could lead to misclassification of priority sector advances.
What you must do
Update the list of states with minority majority in your priority sector lending policy to replace Sikkim with Meghalaya.
Train branch staff and credit officers on the revised state list for weaker section lending.
Review existing loans tagged under weaker sections in Sikkim and reclassify if needed.
Acknowledge receipt of this circular to the RBI as advised.
The circular does not specify the reason, but it is a correction to ensure the list accurately reflects states where a minority community is in majority.
Does this change affect existing loans already classified as weaker section advances?
The circular does not address existing loans. Banks should review and reclassify any loans in Sikkim that were tagged under this provision, as per their internal audit.
Which banks are exempt from this circular?
Regional Rural Banks (RRBs) are excluded from the scope of this circular.
📜 Read the original circular — full text as issued by RBI
RBI/2007-2008/159
RPCD.CO.Plan.BC.
30 /04.09.01/2007-08
October
11, 2007
The
Chairman/Managing Director/
Chief Executive Officer
[All scheduled commercial
banks
(excluding Regional Rural Banks)]
Dear
Sir,
Revised
Guidelines on Lending to Priority Sector – Weaker Sections
Please
refer to our circular RPCD.No.Plan.BC.10856/04.09.01/2006-07
dated May 18, 2007 on the above subject, advising the addition of clause (j)
under paragraph 8 of Section I of the circular RPCD.No.Plan.
BC. 84/04.09.01/2006-07 dated April 30, 2007 on revised guidelines on lending
to priority sector.
2.
In partial modification of the aforesaid circular dated May 18, 2007, we advise
that in the list of States where one of the minority communities is in majority,
the State of Sikkim may be substituted by the State of Meghalaya.
3.
Please acknowledge receipt.
Yours
faithfully,
(C.
S. Murthy)
Chief General Manager-in-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2007-2008/159 · issued 11 Oct 2007. The plain-English explanation above is BankPulse’s own independent summary.
Train branch staff and credit officers on the revised state list for weaker section lending.
📜 Compliance
Update the list of states with minority majority in your priority sector lending policy to replace Sikkim with Meghalaya.
Review existing loans tagged under weaker sections in Sikkim and reclassify if needed.
Acknowledge receipt of this circular to the RBI as advised.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Compliance officer at a bank this circular applies to (All scheduled commercial banks (excluding Regional Rural Banks), Priority sector lending departments, Branch managers handling weaker section advances), your first concrete step on “Priority Sector Lending: Weaker Sections List Updated” is: “Update the list of states with minority majority in your priority sector lending policy to replace Sikkim with Meghalaya.” (RBI issued this 11 Oct 2007).
Circular: RBI/2007-2008/159 -- Priority Sector Lending: Weaker Sections List Updated
Issued: 11 Oct 2007
Action required: Update the list of states with minority majority in your priority sector lending policy to replace Sikkim with Meghalaya.
Action required: Train branch staff and credit officers on the revised state list for weaker section lending.
Action required: Review existing loans tagged under weaker sections in Sikkim and reclassify if needed.
Action required: Acknowledge receipt of this circular to the RBI as advised.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 05 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=3867&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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