Mumbai: RBI came out with final guidelines on branch authorisation, with a refined definition on what constitutes a bank branch and liberalised policies on presence in tier-I centres on Thursday. It also widened the role of bank boards, making them responsible for complying with the new guidelines.
The RBI removed the restriction on tier-I branches, which was earlier linked to the number of branches opened in the unbanked areas. "Restriction on tier-1 branches has been removed,
simplifying the regulations and obviating the need to give the lists of underbanked districts/underbanked states," the apex bank said.
In the revised guidelines, which come a year after the RBI announced a re-look at its April 2016 policy, the RBI has also changed the definition of what constitutes a branch. As against the earlier definition of considering all the outlets including extension counters and ATMs as a 'branch', the new provisions have changed the nomenclature to calling it as a 'banking outlet'.
There will be a 'banking outlet' which will be open for minimum four hours a day and five day a week, while there is scope for a part-time banking outlet which will be a fixed point service unit but not comply with working hours requirement.
It also widened the role of the bank boards, which was limited to approving annual branch expansion plan earlier. "Financial inclusion being the overarching objective of the revised framework and the operational flexibility being given to banks, the Board has been given overall responsibility to ensure that all the guidelines are complied with," it said.
The RBI had constituted an internal working group before coming out with the draft guidelines, which were put in public domain for comments in October last year.
The final guidelines issued on Thursday are operational with immediate effect, the central bank said.
Published Date: May 19, 2017 08:10 am | Updated Date: May 19, 2017 08:14 am