RBI issues final guidelines on banking outlets
Published: May 19, 2017
By TIOLCORP News Service
MUMBAI, MAY 19, 2017: IN terms of announcement made in the Reserve Bank of India's (RBI) first bi-monthly Monetary Policy Statement 2016-17, it was proposed to redefine branches and permissible methods of outreach keeping in mind the various attributes of the banks and the types of services that are sought to be provided. An Internal Working group (IWG) was constituted for the purpose and its Report was placed on RBI's website seeking public comments. Taking into account the suggestions/feedback received various stakeholders, final guidelines on ‘Banking Outlets' have been issued.
These guidelines will provide clarification on what is a ‘banking outlet' and harmonising the treatment of different forms of bank presence for the purpose of opening outlets in underserved areas. The guidelines will be applicable to all Domestic Scheduled Commercial Banks (excluding Regional Rural Banks), Small Finance Banks, Payment Banks and Local Area Banks.
Domestic scheduled commercial banks (other than RRBs) can open, Banking Outlets in Tier 1 to Tier 6 centres without having the need to take permission from Reserve Bank of India in each case. However, the opening of 'banking outlets' during a financial year will be subject to certain conditions.
To encourage the banks to open/frontload more number of banking outlets in unbanked rural centres (URC), they will be allowed to carry forward the benefit of the ‘Banking Outlets', if any, opened in excess of the specified requirement for a period of next 2 years. No extension to avail the benefit will be allowed.
To enable banks to have information for identifying a URC, State Level Banker Committees (SLBCs) shall play a constructive and proactive role. The SLBCs shall compile and have an updated list of all unbanked rural centres in the State which shall be displayed on their website. This list will facilitate banks to choose/indicate the place where they wish to open a ‘banking outlet.' Banks shall inform and coordinate with the SLBC Convenor bank to earmark the centre identified by them. If a bank fails to open the banking outlet in the prescribed period of 1 year, the SLBC convenor bank may indicate the Centre as available for other banks to open a banking outlet. The non-member banks of the SLBC, may also refer to the website and keep the SLBC Convenor banks informed of the centres identified by them.
If a bank proposes to undertake government business at any of the banking outlets/part-time banking outlets, it would require prior approval of the Government authority concerned as also of Department of Government and Bank Accounts, RBI.
