The correct answer is: A. It has a three-tier set-up.
Co-operative banks in India are organized into a three-tier structure:
- Primary co-operative banks (PCBs) are the lowest tier and are located at the village or town level. They provide basic banking services to farmers, small businesses, and individuals.
- State co-operative banks (SCBs) are the second tier and are located at the state level. They provide a wider range of banking services than PCBs, including loans, deposits, and remittances.
- National co-operative bank (NCC) is the apex tier and is located at the national level. It provides support to the SCBs and PCBs, and also undertakes developmental activities in the co-operative sector.
State co-operative banks do have access to the Reserve Bank of India (RBI). The RBI is the central bank of India and is responsible for regulating the banking sector. The RBI provides liquidity support to the SCBs, and also supervises their activities.
Co-operative banks are not urban oriented banks. They are primarily focused on providing banking services to rural areas and to small businesses and individuals.
Co-operative banks function on sound business principles. They are required to maintain a certain level of capital adequacy, and they are also subject to the same prudential regulations as other banks.