Question

Which of the following will be considered as an advance to Priority Sector by the banks?

• A. Credit to farmers for agricultural purposes
• B. Loan to a group of doctors to establish a hospital in a city
• C. Loan to a sick mill owner
• D. Loans given to purchase houses in posh colonies

Answer 1

Answer: (A)

Credit to farmers for agricultural purposes

Credit to farmers for agricultural purposes will be considered as an advance to Priority Sector by the banks. Priority sector lending facility is provided by Reserve bank of India. It helps to provide credit facilities to farmers, micro and maro enterprises, etc.