MFIs step up securitisation deals

…The reason why banks are chasing a few MFIs for securitisation deal is the recent Reserve Bank of India (RBI) directive narrowing the scope of priority sector lending norms governing banks. RBI recently disallowed banks from classifying loans given to non banking finance companies (NBFCs), other then MFIs, as priority sector lending. As per the RBI norms, banks are required to lend 40 per cent of their adjusted net credit to the priority sector. Direct agriculture loans should constitute 18 per cent of priority sector loans for Indian banks……………

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