Why RBI's priority lending norms may not mean quick relief for start-ups

Banks are building capacity to understand this segment better

The RBI’s decision to include loans up to Rs 50 crore to start-ups under priority sector lending (PSL) has been largely welcomed by new entrepreneurs, investors and experts though most agree that it is not going to be an easy job to implement it.

Even banks, many of whom are battling with high NPA (non-performing assets), are also of the opinion that they have to really work towards building capacity for start-up lending knowing that it is a high risk segment as most of these young ventures don’t have any collateral to offer for accessing the loan. They however