RBI sets direct agri-lending target at 11.57%

Number is system-wide average of last three years

Reserve Bank of India (RBI) on Thursday said banks should lend at least 11.57% of their fund directly to non-corporate farmers in fiscal 2015-16.

The number is the system-wide average of the last three years, as computed by the RBI.

From next year, such three year averages will be notified by the regulator at the beginning of every year.

If a bank fails to meet this target, the lender will have to pay penalty, usually investing in bonds by Nabard or of Rural Infrastructure Development Fund (RIDF), at a lower rate.