The Centre hasn't given specific instructions on Tuesday to ask them not to give loans to sensitive customers, like personnel, according to the Minister on Tuesday.
During Question Hour in the Rajya Sabha, Sitharaman said there was no official policy directing not to give loans to certain categories of customers.
The ratings can be based on KYC and other ratings like civil ratings. She said in the Upper House while responding to supplementary queries, I don't think any specific instructions are given to banks - please be careful not to lend to these people.
Banks do exercise a certain degree of discretion based on their available KYC know your customer, she added.
The Minister of State for Bhagwat Kishanrao Karad said banks have problems lending to and politicians. He said that banks see a track record before lending to these customers.
In response to a question about banks not lending to politically exposed persons PEPs, the Union Minister said that this is more from the point of view of large sums of money being transferred from one account to another in accordance with the global requirement where the financial action on terror funding takes place. The minister said that every account would have to be kept on a tab where huge money is transferred to a sensitive bank account.