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Recapitalization of regional rural banks (RRB)
March 27 , 2020
1577 days
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- The Union Cabinet under the chairmanship of PM Modi on March 25, 2020, approved the recapitalization of regional rural banks (RRB) to improve the capital to risk weighted assets ratio.
- An improved CRAR will help the rural banks to meet their credit requirements in rural areas.
- The RRBs should allocate 75% of their credit to priority sector lending.
- The recapitalization funds are being allocated to those banks that are unable to maintain minimum CRAR (Capital to Risk weighted Assets Ratio) of 9%.
- The CRAR for a bank is fixed by RBI.
- The Scheme of Recapitalization of RRBs was launched in 2011 on the recommendation of Dr K C Chakrabarty Committee.
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