Alerts & Updates 11th Apr 2025
The Ministry of Finance, Department of Financial Services, Government of India, has taken a significant step towards further strengthening the Regional Rural Banks (RRBs) network by notifying the amalgamation of 26 RRBs into 11 new entities across 10 States and 1 Union Territory, vide notifications dated 5th April 2025. This marks the fourth phase of consolidation under the ongoing initiative to restructure RRBs based on the principle of “One State, One RRB.” With effect from 1st May 2025, the total number of RRBs in the country will be reduced to 28, covering 26 States and 2 Union Territories. These banks will operate through more than 22,000 branches, with over 92% of them located in rural and semi-urban areas. The consolidation of RRBs is part of a broader effort to create stronger, better capitalised, and more efficient institutions that can play a greater role in promoting financial inclusion and supporting rural development.
Our alert provides an overview of the evolution of RRBs, key policy developments, challenges faced, and the rationale and outcomes of the consolidation process.
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