Finance ministry plans 'One State, One RRB' policy to boost efficiency

RRBs reported their highest-ever consolidated net profit of Rs 7,571 crore for FY24, with a gross non-performing assets (GNPA) ratio of 6.1 per cent - lowest in 10 years

The Union Ministry of Finance is planning to consolidate the Regional Rural Banks (RRBs) under a policy of “One State, One RRB” to improve their efficiency and avoid undue competition among sponsoring public sector banks.

“The ‘One State, One RRB’ policy is on the table, and work is underway. We aim to reduce the total number of RRBs from 43 at present to around 30,” said a senior government official requesting anonymity.

The official further explained that this will result in the merger of RRBs within a state under one sponsor bank based on performance. Consequently, each State will