History of Regional Rural Banks (RRBs)
The Regional Rural Banks were established on the recommendations of Narsimha Committee on Rural Credit. The committee was of the view that RRBs would be much better suited than the commercial banks or Co-Operative Banks in meeting the needs of rural areas. Considering the recommendations of the committee the Government of India passed Regional Rural Banks Act 1976.
As a result, five RRBs were set up on 2 October 1975 on the recommendations of the Narsimha Committee on Rural Credit, during the tenure of Indira Gandhi’s government. The purpose was to include rural areas into the economic mainstream since around 70% of the Indian population was rural.
Prathama Bank, with head office in Moradabad, Uttar Pradesh was the first RRB. It was sponsored by Syndicate Bank and had an authorised capital of Rs. 5 crore. The other four RRBs were Gaur Gramin Bank (sponsored by UCO Bank), Gorakhpur Kshetriya Gramin Bank (sponsored by State Bank of India), Haryana Kshetriya Gramin Bank (sponsored by Punjab National Bank), and Jaipur-Nagaur Anchalik Gramin Bank (sponsored by UCO Bank).
Prathama U.P.Gramin Bank, sponsored by Punjab National Bank one of the leading commercial Bank of India, came into existence by amalgamation of 2 RRBs Viz ( Sarva UP Gramin bank Meerut, Prathama Gramin Bank Moradabad).
Amalgamation of Regional Rural Banks
In 1975, the number of total Regional Rural Banks is only 6. It will be increased to maximum with 196 banks in 1990. Due to the financial crisis and poor performance by the RRBs, some of the banks were merged with some other RRBs.
RRBs periodically go through a process of amalgamation. In January 2013, 25 RRBs were amalgamated into 10 RRBs, totaling 67 RRBs. In March 2016, there were 56 RRBs, covering 525 districts with a network of 14,494 branches. As of 1 April 2020, there are 43 RRBs in India.
Read More – Function of RRB
Organizational structure
The organizational structure for RRB’s varies from branch to branch and depends upon the nature and size of business done by the branch. The head office of an RRB normally had three to nine departments. The following is the decision making hierarchy of officials in a RRB.
1. Board of Directors
2. Chairman & Managing Director
3. General Manager
4. Assistant General Manager
5. Regional Manager/Chief Manager
6. Senior Manager
7. Manager
8. Officer
9. Office Assistant
10.Office Attendant
