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EBT Village Allocation and FIP Roadmap Resolution

Current · Source: Reserve Bank of India · RBI/2010-11/550 · issued 30 May 2011 · ~1 min read
Quick answerRBI directs SLBCs to resolve conflicts where banks are allocated same villages under EBT and FIP, clarifying that multiple banks can operate in unbanked villages with population over 2000.
The rule, in the simplest words
How it plays out — a real example

Rahul, a payments & clearing officer in Indore, was excited to open a new banking outlet in a village with a population of over 2000. He knew that another bank had been allocated the same village under EBT, but he also understood that FIP allowed multiple banks to operate in these areas. Rahul worked with the SLBC to resolve any overlapping allocations and ensured that his bank's FIP roadmap was on track to meet the March 2012 deadline. As a result, the village now had two banking outlets, offering a wider range of services to the local community.

What changed

RBI noted that some states use a 'one district one bank model' for EBT, while FIP allocates unbanked villages with population over 2000 to banks for banking outlets by March 2012. Banks complained about duplicative costs when the same village is allotted under both schemes. RBI now mandates SLBCs to settle such disputes and clarify that FIP allocation does not bar other banks from operating in those villages.

What it means for you

Banks must coordinate via SLBCs to avoid redundant infrastructure costs in villages covered by both EBT and FIP. The FIP roadmap requires at least one banking outlet offering savings, credit, remittance, and insurance, but other banks can still enter based on business potential. This reduces exclusivity and encourages competition in rural banking.

What you must do

Who it affects

All SLBC convenor banks, Banks implementing EBT schemes in states, Banks allocated villages under FIP for population over 2000

❓ Common questions

Can my bank operate in a village already allocated to another bank under FIP?

Yes, RBI clarifies that FIP allocation ensures at least one banking outlet, but does not prevent other banks from extending services based on business potential.

What should we do if the same village is allocated to us under both EBT and FIP?

Raise the issue at the SLBC forum for resolution, as RBI expects SLBC to settle such duplicative cost concerns.

📜 Read the original circular — full text as issued by RBI
RBI/2010-11/550 RPCD.CO.LBS.BC.No. 74/02.19.010/2010-11 May 30, 2011 The Chairmen/Chairman and Managing Director, All SLBC Convenor banks Dear Sir/Madam, Resolution of issues regarding allocation of villages under Electronic Benefit Transfer (EBT) scheme and roadmap for providing banking services in villages with population above 2000 under Financial Inclusion Plan (FIP) It has been brought to our notice that in some States the State Governments are implementing the ICT based Electronic Benefit Transfer (EBT) for routing social security benefits (MNREGA, NOAPS, etc.) to beneficiaries through the banking channel using the 'one district one bank model'. In addition to this, as per the recommendations of the High Level Committee to review the Lead Bank Scheme, unbanked villages having population of more than 2000 have been allocated to various banks for providing of banking services by opening of banking outlets in these villages by March 2012. Some banks have represented to our Regional Offices that they are incurring costs to cover villages under the Roadmap for opening of banking outlets in villages with population of more than 2000, even as the other bank that is allotted the same village under EBT will also be required to do so eventually. The intention of allotting the unbanked villages, with population of more than 2000, amongst various banks was to ensure that these villages are provided with at least one banking outlet for extending banking facilities comprising of minimum four products i.e. Savings, Credit, Remittance and Insurance. The above initiative, however, does not deny the opportunity for any other bank to operate in these areas and extend banking services based on the available business potential. In view of the above it is felt that the SLBC, being the apex body in the State, should be used as a forum for settlement of such issues and for explaining to banks the intention of RBI in extending banking services to unbanked villages through various Financial Inclusion initiatives. Yours sincerely, (A. K. Misra) General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2010-11/550 · issued 30 May 2011. The plain-English explanation above is BankPulse’s own independent summary.
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Worked example & action-note template

Example: if you are a Compliance officer at a bank this circular applies to (All SLBC convenor banks, Banks implementing EBT schemes in states, Banks allocated villages under FIP for population over 2000), your first concrete step on “EBT Village Allocation and FIP Roadmap Resolution” is: “Engage with SLBC to resolve any overlapping village allocations under EBT and FIP.” (RBI issued this 30 May 2011).

  1. Circular: RBI/2010-11/550 -- EBT Village Allocation and FIP Roadmap Resolution
  2. Issued: 30 May 2011
  3. Action required: Engage with SLBC to resolve any overlapping village allocations under EBT and FIP.
  4. Action required: Ensure your bank's FIP roadmap for villages with population over 2000 is on track for March 2012 deadline.
  5. Action required: Clarify internally that FIP allocation does not grant exclusivity; other banks may operate in same villages.
  6. Action required: Review cost-sharing or partnership opportunities with other banks in overlapping villages.
  7. Owner: ____________ Target date: ____________
  8. Board/committee approval needed? Y / N
  9. Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.

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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6440&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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