Bank New Circular: RBI issued a new circular on these banks, know from brokerage firms how it will affect the sector

The market is keeping an eye on Small Finance Banks. The reason for this is that RBI has issued a new circular on Small Finance Banks. This circular will provide relief to SFBs from FY26. Under the new circular, the requirement of priority sector lending will be reduced from 75% to 60%. RBI has eased the rules related to priority sector lending from FY26

Bank New Circular: The market is eyeing Small Finance Banks today. RBI has issued a new circular on Small Finance Banks. SFBs will get relief from FY26. Under the new circular, the requirement of Priority Sector Lending will be reduced from 75% to 60%. RBI has eased the rules related to Priority Sector Lending from FY26. The additional component of PSL will be 20% instead of 35%. RBI says that the total PSL requirement will also be reduced from 75% to 60%. SFBs will have to give less loans to the priority sector. After this, the brokerage has revealed its report on some stocks of this sector.

MORGAN STANLEY ON SFBs

Morgan Stanley, while giving its opinion on Small Finance Banks (SFBs), said that SFBs have got relief from RBI’s new circular. RBI has eased the rules related to Priority Sector Lending (PSL) from FY26. He says that the additional component of PSL will be 20% instead of 35%. The total PSL requirement will also be reduced from 75% to 60%.

The brokerage says that the new RBI rules mean that SFBs will have to give less loans to the priority sector. They have described the RBI circular as structural positive. This will further improve the pace of growth in the long term.

CITI ON SFBs

At the same time, another brokerage firm Citi, while giving its opinion on small finance banks, said that SFBs have got relief from the new RBI circular. The new circular has eased the rules related to Priority Sector Lending (PSL) from FY26. According to the circular, the additional component of PSL will be 20% instead of 35%. More loans were given to MFIs to achieve the PSL target. SFBs can now increase the non-PSL portfolio.

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