CD Ratio Monitoring: Thorat Panel Recommendations Implemented by Government

What changed

Government accepted Thorat Expert Group's recommendations with modifications, replacing earlier CD ratio monitoring with a three-tier framework: individual banks at HO (Cu+RIDF), state level via SLBC (Cu+RIDF), and district level (Cs). Districts with CDR below 40 must set up Special Sub-Committees of DLCC to draw up Monitorable Action Plans (MAPs) with self-set targets and timelines. Districts with CDR below 20 are placed in a special category requiring joint adoption by district administration and lead bank.

What it means for you

Banks must now systematically track credit deployment by utilization (Cu) and sanction (Cs) along with RIDF support, making CD ratio a key performance metric at multiple levels. For districts with low CDR, especially below 40, banks face structured monitoring through SSCs with mandatory action plans and quarterly reporting, increasing accountability. The special treatment for districts below 20 signals that conventional lending approaches won't suffice; banks must collaborate closely with state governments and adopt a higher intensity of effort.

What banks were required to do at the time

• Set up internal systems to report CD ratio at HO level using Cu+RIDF, at state level via SLBC using Cu+RIDF, and at district level using Cs.
• For each district with CDR below 40, ensure your bank's district coordinator participates in the Special Sub-Committee and contributes to drafting Monitorable Action Plans.
• For districts with CDR below 20, prepare for joint adoption with district administration and allocate dedicated resources for higher-intensity credit push.
• Monitor progress of MAPs once every two months and report quarterly to DLCC and through them to SLBC convenor.

Who it affects

All Scheduled Commercial Banks including RRBs, Lead District Managers and Lead Banks, District coordinators of banks in low CDR districts, SLBC convenors and members, NABARD and RBI district level officers