New Delhi: One state-one RRB will become a reality from next month as the Finance Ministry has issued notification for the consolidation of 15 Regional Rural Banks across 11 states to achieve better operational efficiency and cost rationalisation.
With this fourth round of consolidation of regional rural banks (RRBs), the number would reduce to 28 from the existing 43.
As per the gazette notification, RRBs in 11 states — Andhra Pradesh, Uttar Pradesh, West Bengal, Bihar, Gujarat, Jammu & Kashmir, Karnataka, Madhya Pradesh, Maharashtra, Odisha and Rajasthan — are to be merged into one entity, respectively, for each of these to realise the goal of ‘one state-one RRB’.
The effective date for amalgamation has been fixed to May 1, as per the gazette notification dated April 5, 2026.
As per the notification, in line with the powers granted under Section 23A(1) of the Regional Rural Banks Act, 1976, these RRBs will merge into a single entity in the public interest and in the interest of the development of the area served by these entities and also in the interest of the Regional Rural Banks themselves.
For example, Chaitanya Godavari Grameena Bank, Andhra Pragathi Grameena Bank, Saptagiri Grameena Bank and Andhra Pradesh Grameena Vikas Bank sponsored by Union Bank of India, Canara Bank, Indian Bank and State Bank of India amalgamated into a single Regional Rural Bank called as Andhra Pradesh Grameena Bank. The head office of the new entity would be at Amravati and the RRB would be under sponsorship of Union Bank of India, it said.
In the case of Uttar Pradesh and West Bengal, 3 RRBs to be merged into one in each of these states.
As far as Uttar Pradesh is concerned, Baroda UP Bank, Aryavart Bank and Prathama UP Gramin Bank sponsored by the Bank of Baroda, Bank of India and Punjab National Bank amalgamated into Uttar Pradesh Gramin Bank with its head office at Lucknow under the sponsorship of Bank of Baroda.
In the case of West Bengal, Bangiya Gramin Vikash, Paschim Banga Gramin Bank and Uttarbanga Kshetriya Gramin Bank sponsored by the Punjab National Bank, UCO Bank and Central Bank of India to be amalgamated into West Bengal Gramin Bank with its head office in the state capital under the sponsorship of Punjab National Bank.
In eight states -- Bihar, Gujarat, Jammu & Kashmir, Karnataka, Madhya Pradesh, Maharashtra, Odisha and Rajasthan, two RRBs would be merged into one.
For instance, Dakshin Bihar Gramin Bank and Uttar Bihar Gramin Bank will be merged into an entity called Bihar Gramin Bank with its head office in Patna under the sponsorship of Punjab National Bank.
With regard to Gujarat, Baroda Gujarat Gramin Bank and Saurashtra Gramin Bank hereby amalgamated into a single Regional Rural Bank, which shall be called Gujarat Gramin Bank with its head office at Vadodara under the sponsorship of Bank of Baroda.
For the Union Territory of Jammu and Kashmir, J & K Grameen Bank and Ellaquai Dehati Bank sponsored by J&K Bank and State Bank of India to be merged into a single RRB called Jammu and Kashmir Grameen Bank with its head office at Jammu under the sponsorship of J&K Bank, it said.
All the entities would have authorised capital of Rs 2,000 crore, it added.
After consultation with stakeholders, an amalgamation of 26 RRBs in 10 states and 1 UT has been carried out with a primary focus on improvement in scale efficiency and cost rationalisation, the finance ministry said in a statement.
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 22,000 branches covering 700 districts.
Their predominant area of operation is in rural areas, with approx 92 per cent of branches in rural/semi-urban areas, it said.
This is the fourth phase of amalgamation. In Phase 1 (FY 2006 to FY 2010) number of RRBs was reduced from 196 to 82, it was further brought down from 82 to 56 in Phase 2 (FY 2013 - FY 2015) and in Phase 3, it was cut from 56 to 43.
As a precursor to consolidation, the capital infusion was done in these RRBs.
The 2021-22 fiscal was a watershed year in the context of RRBs as the Centre decided to infuse Rs 5,445 crore as its share over a period of two years to facilitate growth capital.