The Narashima Committee established regional rural banks based on the needs of the rural area. The committee felt that RRB would be much better for the rural population than commercial banks or any other commercial banks. Considering all the above, the government has decided to enact the Regional Rural Banks Act, 1975. This law led to the creation of 25 regional rural banks that same year. There are currently 196 regional rural banks in the country. Say no to plagiarism. Get a tailor-made essay on “Why violent video games should not be banned”?Get an original essayThe main purpose and function of the regional rural bank is that in rural areas there are not many commercial banks, their main objective was to develop a commercial organization to the rural mass which was supposed to reach the regional rural bank. The incorporation of regional rural banks gave rise to many regulations that would contribute to the development of the country's economy by providing credit to rural farmers, commerce, etc. Operation of rural banks is limited to certain areas and districts. of different states of the country, it will generally be found in the district heads of different states, RRB is regulated and formulated by NABARD under the governance of the central government and other commercial banks. Every regional rural bank in the country has been sponsored by one or the other public sector bank. It is the duty of public sector banks to provide necessary help and assistance to regional rural banks, these public sector banks help in training and development of RRB employees, they also help in underwriting the action and also provide managerial direction accompanied by financial assistance. But the managerial or financial assistance will be provided for a period of 5 years and the period cannot be increased beyond that with the permission of the Central Government and the State Government concerned and the regulations of the NABARD. The capital requirement of the regional bank is provided by the central government, state governments and some sponsored public sector banks in the amount of 5crors, this capital amount is in the 50% ration and has been contributed by the central government, 35% sponsored public sector banks and 15% state government. All regional rural banks in the country are authorized to carry out their business transactions in accordance with the ACT Banking Regulations 1949. RRB provides all the important facilities provided by the national banks to the rural population like grant of advance loans, credit, l accepting deposits and sending remittances to the rural population, while also investing in other banks and various types of financial institutions. which are prescribed by ACT and NABARD banking regulations, they also invest in government securities. The DICGC schemes are followed by the RRB which also follows the cash reserve ratio and statutory liquidity ratio of regional rural banks which are stipulated by the Reserve Bank of India. . The Reserve Bank of India placed regional rural banks in the priority sector after 1997, commercial banks are expected to provide 40% of their net bank credit to the priority sector, similarly regional rural banks are also expected to provide 25% of their net bank credit. sector banks advance as reserve or provide 10% of their net bank credit to the weaker part of the companies, RRBs are also sponsored by commercial banks for which.