What changed
RBI has opened the door for Regional Rural Banks to apply for currency chest facilities, provided they meet specific eligibility criteria. This supersedes earlier guidelines from December 2005, which had restricted such applications.
What it means for you
For RRBs, this is a significant operational upgrade—currency chests reduce cash handling costs and improve liquidity management. Banks that qualify can now directly manage currency distribution, enhancing service efficiency in rural areas. Lenders must ensure strict adherence to the listed norms to avoid rejection.
What you must do
- Verify your RRB's networth is at least Rs. 50 crore as per the latest NABARD inspection report.
- Confirm the bank has earned net profit for the last three consecutive years and has no accumulated losses.
- Ensure Gross NPA is not more than 10% and there are no CRR/SLR violations in the previous and current years.
- Check compliance with all prudential norms, including exposure limits and instructions on loans to directors and their relatives.
- Submit the application to the concerned Regional Office of RBI's Department if all criteria are met.
Who it affects
Regional Rural Banks (RRBs), RBI Regional Offices, NABARD
What is the minimum networth required for an RRB to apply for a currency chest?
The RRB must have a minimum networth of Rs. 50 crore as per the latest NABARD inspection report.
Can an RRB with accumulated losses apply for a currency chest?
No, the bank must have earned net profit for the last three years and should not have any accumulated losses.
What happens if an RRB has violated CRR/SLR norms?
The bank must have no CRR/SLR violations during the previous and current years relative to the application date to be eligible.