Here are the notes on Regional Rural Banks in India, with MCQs and answers:
Regional Rural Banks (RRBs)
- RRBs are a type of scheduled commercial bank in India that was established in 1975 to provide banking and financial services to the rural areas of the country.
- There are currently 56 RRBs in India, each of which is sponsored by one or more public sector banks.
- The ownership of an RRB is divided into three parts:
- 50% by the central government
- 15% by the state government in which the RRB is located
- 35% by the sponsoring bank
- RRBs are regulated by the Reserve Bank of India (RBI).
Functions of RRBs
- RRBs provide a variety of banking and financial services to the rural areas, such as:
- Deposit accounts
- Loans for agriculture, small businesses, and other purposes
- Money transfers
- Government-sponsored schemes
- RRBs also play a role in promoting financial literacy and economic development in rural areas.
MCQs
- Which of the following is NOT a function of an RRB?
- Providing deposit accounts
- Providing loans for agriculture
- Promoting financial literacy
- Investing in stock markets
Answer: Option (D). RRBs do not invest in stock markets. Their main function is to provide banking and financial services to the rural areas.
- What is the maximum amount of loan that an RRB can provide to a farmer?
- Rs. 1 lakh
- Rs. 2 lakh
- Rs. 3 lakh
- Rs. 5 lakh
Answer: Option (C). The maximum amount of loan that an RRB can provide to a farmer is Rs. 3 lakh.
- Which of the following is NOT a sponsoring bank of an RRB?
- State Bank of India
- Punjab National Bank
- Bank of Baroda
- ICICI Bank
Answer: Option (D). ICICI Bank is a private sector bank and cannot be a sponsoring bank of an RRB.
Answers
- (D)
- (C)
- (D)
Conclusion
RRBs play an important role in providing banking and financial services to the rural areas of India. They have helped to improve financial inclusion and economic development in rural areas.