What changed
The 15th Lok Sabha Committee on Welfare of SCs/STs observed during a visit that one scheduled commercial bank had not set up the mandated Special Cell. RBI has now reiterated the requirement, urging all banks to comply if they have not already done so.
What it means for you
Banks must ensure they have a dedicated Special Cell to monitor credit flow to SC/ST beneficiaries, as per existing priority sector lending guidelines. Non-compliance could attract regulatory scrutiny, especially after this parliamentary observation. This is a compliance reminder, not a new rule.
What you must do
- Verify if your bank has already set up a Special Cell for SC/ST beneficiaries as per the July 2012 Master Circular.
- If not, establish the cell immediately and ensure it monitors credit flow to SC/ST beneficiaries.
- Review implementation of all RBI instructions on credit facilities to SC/ST communities to ensure proper compliance.
- Prepare for potential inspections by parliamentary committees or RBI on this requirement.
Who it affects
All Indian scheduled commercial banks, Priority sector lending departments, Compliance and monitoring teams
Is this a new requirement or a reminder?
This is a reminder. The requirement to set up a Special Cell for SC/ST beneficiaries was already part of the Master Circular on Priority Sector Lending dated July 2, 2012.
What triggered this circular?
The 15th Lok Sabha Committee on Welfare of SCs/STs found during a bank visit that the mandated cell did not exist, prompting RBI to reiterate the instruction.
What should banks do if they already have the cell?
Banks with an existing cell should ensure it is fully functional and that all related credit facility instructions are properly implemented.