Regional rural banks have hit a new financial milestone with a highest-ever net profit of Rs 7,571 crore in fiscal 2024. The update was shared in Parliament on Tuesday by Minister of State for Finance Pankaj Chaudhary, who highlighted RRBs' consistent improvement across key financial metrics.
"The financial health of RRBs has improved in recent years, as they have posted the highest-ever consolidated net profit of Rs 7,571 crore during 2023-24. Also, the RRBs have shown consistent improvement in key financial parameters like CRAR, deposits, advances, NPA, CD ratio, etc.," Chaudhary stated in a written reply to the Rajya Sabha.
Over the past two years, RRBs have expanded significantly, with their total balance sheet size growing from Rs 7,04,556 crore in 2021-22 to Rs 8,40,080 crore in 2023-24.
At the same time, net non-performing assets have nearly halved, dropping from 4.7% in 2021-22 to 2.4% in 2023-24. The credit-to-deposit ratio—a crucial measure of lending activity—has also improved, rising from 64.5% in 2021-22 to 71.4% in 2023-24.
The government has closely monitored RRBs' role in deepening financial access in rural and remote areas. "The government has also reviewed the progress made by RRBs in deepening financial inclusion in rural and remote areas by reviewing performance on various financial inclusion schemes like Pradhan Mantri Jan Dhan Yojana, Pradhan Mantri Suraksha Bima Yojana, Pradhan Mantri Jeevan Jyoti Bima Yojana, Atal Pension Yojana, etc.," Chaudhary noted.
Responding to another query, Chaudhary outlined key enhancements to farm credit schemes. Under the Modified Interest Subvention Scheme, the government provides an interest subvention of 1.5% on short-term working capital loans of up to Rs 3 lakh at 7% per annum.
For farmers who repay on time, there is an additional 3% repayment incentive, effectively reducing the interest rate to just 4%. In the Union Budget 2025-26, the government announced a significant increase in the Kisan Credit Card loan limit from Rs 3 lakh to Rs 5 lakh.
Chaudhary also highlighted Jan Samarth, a one-stop digital platform linking 15 government-sponsored loan and subsidy schemes. The portal provides a fast and efficient way to apply for loans, leveraging digital evaluation for quick approvals.
"Additionally, many banks and financial institutions have developed online platforms and mobile apps for end-to-end digital processing of loan applications, reducing the need for physical paperwork and in-person visits," he added.
(With inputs from PTI).
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