Retail and wholesale traders have been classified as MSME (Micro, Small, and Medium Enterprises) by the government.
Highlights:
The MSME sector includes the industrial and service sectors but not the Agriculture-notes-for-state-psc-exams”>Agriculture sector.
Despite the fact that the retail and wholesale trades are all part of the Services-sector”>services sector, they were not considered MSMEs.
Because MSMEs are included in the Priority Sector Lending (PSL) Guidelines, Retail and Wholesale trade will now be able to obtain loans under PSL.
Priority Sector Lending is an important role assigned by the RBI to banks in which a specified portion of bank lending is directed toward a few specific sectors.
In the absence of this special dispensation, these sectors of the economy with high social returns and a high need for inclusive development may not receive timely and adequate credit.
Today, banks lend nearly 40 percent of their adjusted net bank credit to the priority sector.