RBI Proposes Revised Lead Bank Scheme Framework, Seeks Public Comments

New Delhi, Feb 14 (KNN) The Reserve Bank of India (RBI) on Friday released draft revised guidelines for the Lead Bank Scheme (LBS), inviting public comments until March 6, 2026. 

The move follows its February 6 policy statement indicating that updated norms would be issued to streamline the scheme’s operational framework.

Launched in 1969, the LBS is designed to coordinate banks, government departments and development agencies at the district level to enhance credit flow to priority sectors and strengthen financial inclusion. 

The proposed revisions seek to refine the scheme’s objectives, restructure and clarify the functioning of various LBS fora, clearly define roles and responsibilities of key functionaries, and strengthen State Level Bankers’ Committees and Lead District Manager offices. 

A designated commercial bank in each district will continue to act as the Lead Bank, coordinating credit-related activities among stakeholders.

The draft framework emphasises a bottom-up approach to credit planning, with block-wise and sector-specific assessments forming the basis of targeted credit plans. 

SLBC convenor banks will be required to regularly review operational challenges, coordinate with state authorities, expand banking access and monitor the Credit-Deposit ratio, maintaining a 60 per cent benchmark across rural and semi-urban branches at the all-India level. 

Banks are also encouraged to flag infrastructure and administrative constraints that may hinder outreach.

The RBI said the proposed changes aim to improve coordination and ensure more effective credit delivery to priority sectors and underserved regions.

(KNN Bureau)