The Indian government is considering changes to the priority sector lending (PSL) scheme to allow banks' deposits in Rural Infrastructure Development Fund (RIDF) and other funds to qualify as exposure under PSL. This would provide banks with more flexibility in meeting sector-specific PSL targets and free up capital for extending credit to industrially vibrant sectors, fostering economic growth. Currently, deposits banks make in RIDF and other such funds are not allowed to compensate for the shortfall in meeting PSL targets.
source https://www.livemint.com/news/india/indian-banks-seek-changes-to-priority-sector-lending-rules-rbi-may-restructure-to-allow-deposits-in-rural-infrastructure-funds-11684174627791.html
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