Nirmala Sitharaman Reviews Performance of 4 states RRB in Bihar

A meeting of the eight Regional Rural Banks (RRB) operating in four states of the Eastern Region- Bihar, Jharkhand, Odisha and West Bengal was held in Patna, Bihar, on 29 November 2024. The Union Finance and Corporate Affairs Minister, Nirmala Sitharaman chaired the meeting.

The Union Ministry of Finance periodically holds meetings with the heads of the RRBs to review banks' performance.

Who attended the meeting?

Apart from the Union Finance Minister, the Deputy Chief Minister of Bihar, Samrat Choudhary, and the Secretary of the Department of Financial Services, M. Nagaraju, were also present.

The meeting was also attended by representatives of the Reserve Bank of India, National Bank for Agricultural and Rural Development (NABARD), and Small Industrial Development Bank of India( SIDBI), the Chairperson of these eight RRBs, and the senior officers of these four states.

Agenda of the Meeting 

The RRB review meeting focused on banks’ financial performance, the status of upgrading digital technology services within the bank, business growth in activities in agriculture and allied sectors and deepening financial inclusion in rural areas.

Nirmala Sitharaman also directed these RRBs to increase their share in agriculture loan disbursement with a special focus on allied agriculture activities like dairy, animal husbandry, fisheries, etc.

About Regional Rural Bank 

On the recommendation of the Working Group on Rural Banks, headed by M . Narasimham,

 Regional Rural Banks (RRB) were established in India in 1975.

These niche banks were to provide banking facilities and cheap credit to people in rural areas.

The Reserve Bank of India regulates the RRBs.

• The first five RRBs were established on 2 October 1975 through an ordinance issued by the Indian President.
• The first RRB, Prathama Bank, was established in Moradabad (U.P.) and sponsored by Syndicate Bank. 
• The Regional Rural Bank Act was enacted in 1976 and was further amended in 2015.
• The Regional Rural Banks are owned by the central government, the state government and the sponsoring banks.
• There are 43 Regional Rural Banks in the country, sponsored by 12 commercial banks operating in 26 states and 3 Union Territories.
• Only two states -Sikkim and Goa- have no Regional Rural Bank.
• The Regional Rural Banks are sponsored by 11 Public sector banks and one private sector bank, Jammu and Kashmir Bank. 
• Punjab and Sindh Bank is the only public sector bank that has never sponsored any RRB.