- Crisis In Indian Banking Leads to Work Pressure and Driving Employees To Despair, Commit Extreme Steps
- Toxic work culture on the rise in banks
- 5DaysBanking: Bankers Urgently Demand 2 Days Off Per Week
- Banks see over 15% growth in new credit card addition: RBI data
- Banks Transfer ₹37,176 Crore to RBI’s Depositor Education and Awareness Fund in Last 3 Years
- Calls for Bankers’ Safety Amplified After Video of SBI Branch Manager Attack Goes Viral
- Nainital Bank Faces Privatisation Move Amid Staff Protests
- Whistleblowers Expose Nexus Operating from Three Banks
- Preserving RRBs: AIRRBEA Defends Rural Banking Against AIBOC-AIBEA Merger Proposals
- Union Bank of India’s new directive for weekend work at Retail Loan Points (RLPs) has sparked outrage among bankers
Amalgamation of RRBs: Will One State One RRB Reshape SBI’s Sponsorship Role in RRBs?
The One State One RRB initiative is set to reduce SBI's sponsorship from 14 to 8 RRBs, reshaping its influence. AIRRBEA highlights the ongoing pressure and resistance surrounding the amalgamation process.
Author: Saurav Kumar
Published: January 3, 2025
The One State One RRB initiative has gained significant traction, bringing the role of sponsor banks into sharp focus. Among them, the State Bank of India (SBI), the largest sponsor bank, holds the distinction of overseeing 14 Regional Rural Banks (RRBs)—the highest for any commercial bank.
Rural banking experts predict a decline in SBI’s influence as the RRB amalgamation process moves forward. The number of RRBs under SBI’s sponsorship is expected to shrink considerably. AIRRBEA Secretary General, Venkateshwar Reddy told Kanal, “With the ongoing amalgamation of RRBs, SBI’s reach will be reduced to 8 RRBs, down from the current 14—a loss of 6 RRBs.” He further added that, according to inside sources, SBI’s management appears to be the most displeased among all sponsor banks regarding these changes.
SBI’s Decreasing Hold in States, Union Territory and RRBs
According to the recent proposal by the Department of Financial Services (DFS) regarding sponsor banks, the SBI is set to witness a significant decline in its sponsorship influence across five states and one union territory. The affected regions include Rajasthan, Gujarat, Odisha, Andhra Pradesh, Madhya Pradesh, and Jammu and Kashmir. The RRBs likely to transition out of SBI’s sponsorship include Rajasthan Marudhara Gramin Bank, Saurashtra Gramin Bank, Utkal Grameen Bank, Andhra Pradesh Grameena Vikas Bank, Madhyanchal Gramin Bank, and Ellaquai Dehati Bank.
Image: As per the DFS proposal, Six RRBs that the SBI would lose its sponsorship
SBI is set to relinquish its role as sponsor bank to four commercial banks namely - Canara Bank, Bank of Baroda, J&K Bank, and Bank of India.
SBI Sponsored RRBs Under Pressure
The ongoing amalgamation process appears to have created a climate of uncertainty and pressure for the 14 RRBs currently sponsored by SBI.
Reacting to the developments, AIRRBEA Secretary General Venkateshwar Reddy told Kanal, “SBI’s management is making persistent efforts to convince various state governments and the Chairman of its 14 sponsored RRBs to retain its control, framing it as a matter of institutional prestige. While the Chairpersons have approached us regarding the issue, we don’t foresee any major changes to the DFS proposal on sponsor banks.”
Recently, Chairman of the SBI-sponsored Saurashtra Gramin Bank faced allegations of hindering the amalgamation process.
As the One State One RRB initiative advances, SBI’s role as a sponsor bank faces transformation, potentially influencing the dynamics of other sponsor banks involved in the RRB ecosystem.