What changed
RBI advised RRBs to prioritise branch expansion in unbanked rural centres over a 3-year cycle co-terminus with the Financial Inclusion Plan (2013-16), instead of just meeting the annual 25% allocation. Excess branches opened beyond 25% in a year can now be carried forward as credit to the next year of the FIP.
What it means for you
This circular accelerates rural banking penetration to support Direct Benefit Transfer (DBT) and Electronic Benefit Transfer (EBT) schemes. RRBs must now plan branch expansion strategically over three years, not just annually, to achieve universal coverage. The carry-forward provision incentivises early and aggressive branch openings in underserved areas.
What you must do
- Review your current branch expansion plan to frontload openings in unbanked rural (Tier 5/6) centres over the 2013-16 FIP cycle.
- Ensure at least 25% of annual branch proposals target unbanked rural centres; track excess openings for carry-forward credit.
- Align branch expansion timelines with DBT/EBT rollout requirements to facilitate seamless government benefit transfers.
- Acknowledge receipt of this circular to your respective Regional Office.
Who it affects
All Regional Rural Banks (RRBs), Banks' branch expansion planning teams, Financial inclusion and DBT/EBT implementation units
What is the definition of an unbanked rural centre?
An unbanked rural centre is a rural (Tier 5 or Tier 6) centre that does not have a brick-and-mortar branch of any scheduled commercial bank for customer-based banking transactions.
How does the carry-forward credit work for excess branch openings?
If a bank opens more than 25% of its annual branches in unbanked rural centres, the excess count is credited and can be carried forward to the subsequent year of the Financial Inclusion Plan (2013-16).
Does the 25% allocation rule still apply?
Yes, the requirement to allocate at least 25% of total branches proposed in a year to unbanked rural (Tier 5/6) centres continues unchanged.