One State One RRB: Streamlining Rural Banking

The finance ministry announced the 'One State One RRB' initiative, merging 26 Regional Rural Banks into 28 unified entities. This move, affecting over 22,000 branches across 700 districts, aims to improve financial viability and performance. The consolidation hopes to enhance credit growth aligned with state-specific goals.

The finance ministry has announced a significant restructuring of India's Regional Rural Banks (RRBs). With the launch of the 'One State One RRB' scheme, from May 1, 28 RRBs will function across India, amalgamating 26 banks into standalone RRBs in 11 States and Union Territories.

This initiative has decreased the number of RRBs from 43 to 28, aiming to enhance their financial viability, according to the Department of Financial Services (DFS). The reorganization intends to bolster the capital base of these banks, facilitating credit growth and diversification to meet state-specific targets.

The DFS further communicated that all 28 entities would possess authorized capital amounting to Rs 2,000 crore, signaling a strategic move towards strengthened rural banking infrastructure in the country.

(With inputs from agencies.)