Credit gaps persist in sectors such as MSMEs, agriculture and among women entrepreneurs, even as banks have made considerable progress in meeting Priority Sector Lending (PSL) targets, with an achievement rate of 44.7 per cent as of March 31, said RBI Deputy Governor Swaminathan J. He noted that Priority Sector Lending, which originated in the 1960s, was conceived as a tool to direct credit towards key sectors that had been overlooked by institutional lending, aligning with broader economic and social goals. “The composition of priority sectors and their associated targets has evolved in response to changing economic landscapes and national priorities. Initially, it encompassed agriculture and small-scale industries, but over time, it expanded to include areas such as MSMEs, education, and renewable energy, while also applying to a broader range of banks.