Banks can co-originate loans with NBFCs
The RBI has permitted all scheduled commercial banks to cooriginate loans with nonbanking financial companies (NBFCs) for creating eligible priority sector assets. The central bank, however, has excluded regional rural banks (RRBs) and small finance banks (SFBs) from coorigination as most of the loans they originate are priority sector loans. The RBI has said that guidelines on co-origination of priority sector loans will be issued by the end of September.
Priority sector loans include loans given to agriculture, MSMEs, export credit, education, housing, social infrastructure, and renewable energy, among others.