Union Cabinet has approved extension of scheme of recapitalization of Regional Rural Banks (RRBs) for next three years (upto 2019-20).

• This will enable RRBs to maintain minimum prescribed Capital to Risk Weighted Assets Ratio (CRAR) of 9%. It will ensure strong capital structure and minimum required level of CRAR.
• This will facilitate financial stability of RRBs and enable them to play greater role in financial inclusion and meeting credit requirements of rural areas.
• The scheme of Recapitalization of RRBs was started in 2010-11 

About Regional Rural Banks: RRBs were set up as government-sponsored, regional based rural lending institutions under Regional Rural Banks Act, 1976. They are scheduled commercial banks (Government banks) and are configured as hybrid micro banking institutions, combining local orientation and small scale lending culture of cooperatives and business culture of commercial banks.