Which of the following grants/grant direct credit assistance to rural

Which of the following grants/grant direct credit assistance to rural households?

1. Regional Rural Banks
2. National Bank for Agriculture and Rural Development
3. Land Development Banks

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1 and 2 only

2 only

1 and 3 only

1, 2 and 3

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This question was previously asked in

UPSC IAS – 2013

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Regional Rural Banks (RRBs) and Land Development Banks (or their successors within the cooperative structure) are financial institutions that provide direct credit facilities to rural households for various purposes like agriculture and rural development activities. NABARD, on the other hand, is primarily an apex institution providing refinance and support to banks and other financial institutions, rather than direct credit to individual households.

RRBs were established to cater to the banking and credit needs of the rural population directly. Land Development Banks (part of the cooperative credit structure) focus on long-term agricultural finance, also providing credit directly to farmers (rural households). NABARD functions as a refinancing and supervisory body for rural credit institutions.

While NABARD is crucial for the rural credit system, its role is mainly at the wholesale level, channeling funds to the retail institutions (like RRBs, Cooperative Banks, and sometimes commercial banks) which then disburse direct credit to the ultimate borrowers (rural households).

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