Which of the following statements regarding Regional Rural Banks (RRB)

Which of the following statements regarding Regional Rural Banks (RRB) in India is/are correct ?

The basic aim of setting up the RRBs is to develop rural economy.
The area of RRBs is limited to a specific region comprising one or more districts.
RRBs are sponsored by Commercial Banks.

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This question was previously asked in

UPSC CAPF – 2011

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All three statements are correct regarding Regional Rural Banks (RRBs) in India. RRBs were established with the primary objective of providing credit and other banking facilities to small and marginal farmers, agricultural labourers, artisans, and small entrepreneurs in rural areas to facilitate the development of the rural economy. The operations of each RRB are confined to a specific geographical area, usually comprising one or more districts within a state. Every RRB is sponsored by a Scheduled Commercial Bank, which provides financial and managerial assistance. The ownership structure is Central Government (50%), State Government (15%), and Sponsor Bank (35%).

– RRBs were set up to cater to the credit and banking needs of the rural population.
– Their operational area is restricted to a defined region (districts).
– RRBs are sponsored by Commercial Banks.

RRBs were established based on the recommendations of the Narasimham Working Group (1975). They combine the local feel and familiarity of cooperative banks with the professional management and resource base of commercial banks.

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