What changed
RBI notified the inclusion of 25 amalgamated Regional Rural Banks in the Second Schedule to the RBI Act, 1934, via notification dated September 22, 2008. Simultaneously, 76 erstwhile RRBs were excluded from the same schedule, reflecting their dissolution post-amalgamation.
What it means for you
For banks, this update ensures that only the surviving amalgamated RRBs are recognized as scheduled banks, impacting their access to RBI facilities and statutory obligations. Lenders dealing with these RRBs must update their records to reflect the new legal entities for compliance and transaction purposes.
What you must do
- Update internal systems to recognize the 25 amalgamated RRBs as scheduled banks.
- Remove the 76 erstwhile RRBs from your list of scheduled banks to avoid compliance errors.
- Verify counterparty details with these RRBs to ensure transactions reference the correct legal entity.
- Inform relevant departments (e.g., treasury, credit) about the schedule changes for accurate reporting.
Who it affects
Regional Rural Banks (RRBs), Banks and financial institutions dealing with RRBs, RBI regional offices, Compliance and legal teams in banks
Why were 76 RRBs excluded from the Second Schedule?
These RRBs were excluded because they ceased to exist after amalgamation into 25 new entities, as per RBI's notification dated September 22, 2008.
When did these changes take effect?
The notifications were issued on September 22, 2008, and published in the Gazette of India on November 15, 2008.
Do I need to update my bank's records for these RRBs?
Yes, you must update your systems to reflect the 25 amalgamated RRBs as scheduled banks and remove the 76 erstwhile ones to ensure accurate regulatory compliance.