CS Professional · Banking and Insurance - Laws and Practice · Banking Operations
Gramin Vikas Regional Rural Bank needs RBI permission to open a new branch under Section 23. How must it submit its application?
The RRB sends the application to RBI through the National Bank, which comments on its merits and forwards it. The RRB must also send an advance copy directly to RBI, as Section 23(4A) provides.
- ADirectly to RBI only, with no copy to NABARD
- BTo NABARD only, which then decides the matter
- CThrough the National Bank, which comments and forwards it to RBI, while the RRB also sends an advance copy directly to RBICorrect
- DTo the Central Government, which forwards it to RBI
Explanation
Section 23(4A) requires a regional rural bank to forward its application through the National Bank, which gives its comments on merits and sends it to RBI. The RRB must also send an advance copy directly to RBI. Options A and B each omit one part of this dual route.
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