The Department of Financial Services (DFS) has notified the amalgamation of 26 Regional Rural banks (RRBs) on the principles of “One State One RRB”. This is the fourth phase of the amalgamation of RRBs.
Considering the improvement in RRBs’ efficiency due to amalgamations in the past, the Ministry of Finance rolled out an amalgamation plan in November 2024 for consultation with stakeholders. After consultation, the amalgamation of 26 RRBs in 10 States and 1 UT has been carried out, with a primary focus on improving scale efficiency and cost rationalization.
At present, 43 RRBs are functioning in 26 States and 2 UTs. Post amalgamation, there will be 28 RRBs in 26 states and 2 UTs with over 22000 branches covering 700 districts. Their predominant area of operation is in rural areas with approx. 92% of branches in rural/semi-urban areas.
This is the fourth phase of amalgamation. In the previous 3 phases viz. Phase-I (FY 2006 to FY 2010), the number of RRBs was reduced from 196 to 82, Phase-2 (FY 2013 – FY 2015) from 82 to 56; and in Phase-3 (FY 2019 to FY 2021) number of RRBs was reduced from 56 to 43.
