MICROCAPITAL BRIEF: Reserve Bank of India (RBI) Mandates Banks Open 25% of New Branches in Rural Areas; Banks May Offer Only Limited Financial Services

The Reserve Bank of India (RBI), the country's central banking authority, recently published circulars that will require new and existing banks to open one quarter of new branches in towns with populations of less than 10,000 people in an effort to further the government's financial inclusion agenda. An unnamed senior official from a public sector bank is quoted as saying that the banks would “have to work out cost-effective ways to open branches in rural areas,” such as providing only basic banking services, at least for an initial period. The circular covering new banks also requires that they submit... Continue reading here. Contact MicroCapital to receive a complete sample issue of the MicroCapital Monitor, the monthly microfinance newspaper.