The merger of Regional Rural Banks (RRBs) with sponsor banks has ignited widespread debate, with industry experts like former Finance Secretary S.P. Shukla and economist Prof. C.P. Chandrasekhar voicing strong opposition. They argue that such consolidation undermines the unique identity of RRBs, essential for financial inclusion in rural India. As the Independent Commission on Banking and Finance highlights, merging RRBs would shift focus from social banking to profit-driven models, threatening the rural economy’s lifeline.
