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    Question

    What is the limit of credit for FPOs under Priority

    sector lending for the agriculture production purpose?
    A 1 Cr Correct Answer Incorrect Answer
    B 5 Cr Correct Answer Incorrect Answer
    C 2 Cr Correct Answer Incorrect Answer
    D 10 Cr Correct Answer Incorrect Answer
    E 12.50 Cr Correct Answer Incorrect Answer

    Solution

    Under revised guidelines of RBI for credit under PSL - Loans for the following activities will be subject to an aggregate limit of ₹2 crore per borrowing entity:   (i) Crop loans to farmers which will include traditional/non-traditional plantations and horticulture and loans for allied activities.  (ii)  Medium and long-term loans for agriculture and allied activities (e.g. purchase of agricultural implements and machinery and developmental loans for allied activities).  (iii)  Loans for pre and post-harvest activities viz. spraying, harvesting, grading and transporting of their own farm produce.  (b) Loans up to ₹50 lakh against pledge/hypothecation of agricultural produce (including warehouse receipts2) for a period not exceeding 12 months.  (c) Loans up to ₹5 crore per borrowing entity to FPOs/FPCs undertaking farming with assured marketing of their produce at a pre-determined price.

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