The government has asked public sector banks to increase lending to employment-generating sectors, particularly agriculture and small and medium enterprises, during the second half of this fiscal when the demand for credit rises.
Mukherjee also asked them to pay attention to seekers of housing loans up to Rs 10 lakh and hoped that lending to minorities will rise to the targeted 15 per cent of their lending by this fiscal-end.
"Taking advantage of the upcoming busy season, banks should gear up to enhance credit flow to the employment generating sectors, especially agriculture and the Micro & Small Enterprises," he said at a meeting of bankers here.
He said banks should step up credit flow to agriculture in subsequent quarters to meet their current year priority sector lending target.
Mukherjee said the government has come out with an extra one per cent subvention on interest to farmers who pay their dues in time and asked banks to make use of this scheme to improve repayments.
He said the government is providing interest subsidy of one per cent on all individual housing loans up to Rs.10 lakh for units costing up to Rs. 20 lakh and advised banks to pay due attention to such borrowers.
He emphasised the need to target these loans to the rural areas so as to meet the housing needs of the rural population.
