What changed
This Master Circular consolidates all previous RBI instructions on credit facilities for SC/ST into one document, replacing earlier circulars listed in Annexure III. It reiterates existing guidelines without introducing new policy changes.
What it means for you
Banks must continue to prioritize SC/ST lending through weighted credit planning and special schemes. The circular reinforces the need for sympathetic loan processing, closer liaison with development agencies, and village adoption strategies focused on SC/ST populations.
What you must do
- Review and align your branch-level credit plans to give weightage to SC/ST borrowers.
- Design bankable schemes suited to SC/ST communities and ensure field staff promote them.
- Establish or strengthen liaison with District Industries Centres and Lead Bank committees.
- Train staff to assist illiterate borrowers with application forms and complete formalities promptly.
- Periodically review lending procedures to ensure timely, adequate, and production-oriented loans.
Who it affects
All Indian scheduled commercial banks, Lead banks and their district-level committees, Bank branch managers and field staff handling priority sector lending, SC/ST borrowers seeking credit facilities
Does this Master Circular introduce new lending targets for SC/ST?
No, it consolidates existing instructions without setting new targets. Banks must continue to weight credit planning in favor of SC/ST and ensure sympathetic loan processing.
What specific actions must banks take for SC/ST borrowers?
Banks should adopt villages with sizeable SC/ST populations, design special bankable schemes, help illiterate borrowers with forms, and create awareness through field staff rather than just brochures.
How should banks coordinate with other agencies for SC/ST lending?
Banks must use District Level Consultative Committees under the Lead Bank Scheme as the main coordination mechanism and establish closer liaison with District Industries Centres.