Kolkata:Regional rural banksare poised to go through a fourth round of consolidation with the government planning to embark upon a state-wise amalgamation exercise, which would bring down the number of RRBs to 28 from the current 43.. The government has prepared a roadmap towards the goal of ‘One State-One RRB’ in consultation with the National Bank for Rural & Agricultural Development (Nabard).. The government thinks this exercise would “derive the benefits of scale, efficiency and cost rationalisation”.. Consolidation of RRBs started in 2004-05 and after three phases of amalgamation, the number has come down to 43 from 196. This has helped RRBs “minimise their overhead expenses, optimise the use of technology, enhance the capital base and area of operation, and increase their exposure”.. “Given the rural expansion of RRBs and agro-climatic/geographical ethos and in order to retain the USP of RRBs viz. closeness to communities, it is the felt need to embark on further consolidation of RRBs towards the goal of ‘One State-One RRB’,” the government said Monday in a communication to all sponsor banks.. The central government holds 50% in every RRB, sponsor banks hold 35% each and the respective state government holds 15%.. At present, 12 states including Andhra Pradesh, Bihar, Gujarat, Karnataka and West Bengal have more than one RRB.. For example, Andhra has four RRBs—Andhra Pragathi Grameena Bank sponsored by Canara Bank, Chaitanya Godavari Grameena under Union Bank of India, Saptagiri Grameena Bank under Indian Bank and Andhra Pradesh Grameena Vikas Bank (AP Part) under State Bank of India. These four would be amalgamated into one and be brought under Canara Bank.. Likewise, West Bengal has three—Bangiya Gramin Vikash Bank wherein Punjab National Bank is the sponsor bank, Paschim Banga Gramin Bank under Uco Bank and Uttar Banga Kshetriya Gramin under Central Bank of India. They are proposed to be one entity under PNB.. The government has invited comments from sponsor banks on the roadmap given.. Nominations for ET MSME Awards are now open. The last day to apply is November 30, 2024. Click here to submit your entry for any one or more of the 22 categories and stand a chance to win a prestigious award.. (You can now subscribe to our Economic Times WhatsApp channel)
