What Is Priority Sector?

Are you curious to know what is priority sector? You have come to the right place as I am going to tell you everything about priority sector in a very simple explanation. Without further discussion let’s begin to know what is priority sector?

Priority Sector, a cornerstone in economic policy, plays a pivotal role in fostering inclusive development. In this comprehensive guide, we delve into the nuances of Priority Sector, its significance in banking, and its impact on the broader economic landscape.

What Is Priority Sector?

Priority Sector refers to a segment of the economy that receives special attention from financial institutions and policymakers due to its importance in promoting inclusive growth. It encompasses sectors that contribute significantly to employment generation and support the livelihoods of vulnerable populations.

What Is Priority Sector Lending In Banking?

Priority Sector Lending in Banking refers to the practice of allocating a certain percentage of a bank’s total lending portfolio to sectors identified as priorities by the government. This proactive approach ensures that financial resources are directed towards segments crucial for economic development.

What Is Anbc In Priority Sector Lending?

ANBC, or Adjusted Net Bank Credit, is a key parameter used to calculate the percentage of Priority Sector Lending for banks. It represents the net credit provided by banks, considering factors like investments and off-balance sheet items.

What Is Priority Sector Lending Certificate?

A Priority Sector Lending Certificate is a tradable instrument that allows banks to fulfill their Priority Sector Lending targets by purchasing certificates from other banks that have exceeded their mandated lending to priority sectors.

What Is Priority Sector Rbi?

The Reserve Bank of India (RBI), as the central banking institution, plays a crucial role in formulating and regulating Priority Sector guidelines. The RBI ensures that banks comply with Priority Sector Lending norms to promote financial inclusion and equitable development.

What Is Priority Sector Loan?

A Priority Sector Loan is a financial product specifically designed to cater to the funding needs of sectors identified as priorities. These loans come with certain incentives and concessions to encourage banks to actively participate in supporting the growth of these sectors.

What Is Priority Sector In India?

In the Indian context, Priority Sector encompasses a diverse range of sectors, including agriculture, micro and small enterprises, education, housing, and more. It reflects the commitment of the government and financial institutions to address the developmental needs of the country.

What Is Priority Sector In Economics?

In economic terms, Priority Sector refers to segments that contribute significantly to overall economic development and welfare. Prioritizing these sectors ensures a more balanced and inclusive economic growth trajectory.

What Is Priority Sector In Banking?

In the banking sector, Priority Sector involves directing credit and financial resources towards sectors deemed crucial for economic development. Banks are mandated to meet specific targets for lending to priority sectors, fostering financial inclusion and rural development.

What Is Priority Sector In Agriculture?

A significant component of Priority Sector is agriculture. This includes providing financial support to farmers, agricultural infrastructure development, and promoting sustainable agricultural practices to ensure food security and rural prosperity.

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Priority Sector Lending Upsc

For aspirants preparing for UPSC exams, understanding Priority Sector Lending is essential. Questions related to the impact of Priority Sector on the Indian economy and banking sector may be part of the examination syllabus.

Priority Sector Lending Pdf

A Priority Sector Lending PDF could serve as a comprehensive resource for bankers, policymakers, and researchers. It may include detailed information on guidelines, targets, and the impact of Priority Sector Lending on the overall economy.


Priority Sector stands as a linchpin in fostering a balanced and inclusive economic landscape. From shaping banking policies to promoting sustainable agriculture and supporting vulnerable populations, Priority Sector plays a multifaceted role in steering the trajectory of economic development. As financial institutions continue to align with Priority Sector guidelines, the impact on sectors vital for inclusive growth remains profound, contributing to a more equitable and resilient economy. Understanding the dynamics of Priority Sector is not just a requirement for bankers and policymakers but is crucial for anyone keen on comprehending the intricate threads of economic development and financial inclusion in India.


What Is Meant By Priority Sector?

Priority Sector means those sectors which the Government of India and Reserve Bank of India consider as important for the development of the basic needs of the country and are to be given priority over other sectors. The banks are mandated to encourage the growth of such sectors with adequate and timely credit.

How Many Priority Sectors Are There In India?

As per the RBI circular released in 2016, there are eight broad categories of the Priority Sector Lending. They are: (1) Agriculture (2) Micro, Small and Medium Enterprises (3) Export Credit (4) Education (5) Housing (6) Social Infrastructure (7) Renewable Energy (8) Others.

What Is The Difference Between Priority And Non Priority Sector?

In banking, a non-priority sector refers to those sectors that are not considered as a priority for lending by financial institutions. Priority sectors are those identified by the government as needing more attention for the country’s overall economic development.

What Is The Meaning Of Psl In Rbi?

Priority Sector Lending – Definition, History, Activities, Targets by RBI, New Guidelines And More. Last updated on Oct 16, 2023 Also Read Priority Sector Lending in Hindi. Priority Sector Lending (PSL) is a way to provide higher priority to certain economic sectors in the country.

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What Is Priority Sector

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Priority Sector Lending Upsc

Priority Sector Lending Pdf

What Is Priority Sector