What changed
RBI issued a clarification stating that the guidelines on credit delivery to micro and small enterprises, originally issued in December 2008, are applicable only to scheduled commercial banks. Regional Rural Banks (RRBs) and Local Area Banks (LABs) are explicitly excluded from these guidelines.
What it means for you
For scheduled commercial banks, the December 2008 MSE credit norms remain fully in force. RRBs and LABs do not need to comply with those specific guidelines, but they must continue to follow other applicable lending norms. This clarification removes any ambiguity about the scope of the earlier circular.
What you must do
- Scheduled commercial banks: Continue implementing the December 2008 MSE credit delivery guidelines without change.
- RRBs and LABs: Confirm that the December 2008 circular does not apply to your institution; no action needed on that front.
- All banks: Ensure internal compliance teams are aware of this scope clarification to avoid misapplication.
Who it affects
Scheduled commercial banks, Regional Rural Banks (RRBs), Local Area Banks (LABs)
Does this circular change any lending norms for MSEs?
No. It only clarifies that the December 2008 guidelines on credit delivery to micro and small enterprises apply solely to scheduled commercial banks, not to RRBs or LABs.
Are RRBs and LABs completely exempt from MSE lending rules?
Only from the specific December 2008 circular mentioned. They must still follow all other applicable RBI directives on MSE lending.