The Reserve Bank of India (RBI) has permitted Rural Co-operative Banks to open new branches under the Automatic Route, in accordance with the RBI (Rural Co-operative Banks – Branch Authorisation) Directions, 2025
As per the Directions, State Co-operative Banks (StCBs) and Central Co-operative Banks (CCBs) that comply with the Eligibility Criteria for Business Authorization (ECBA) may open branches without obtaining prior approval from the RBI.
The number of branches that can be opened under the Automatic Route in a financial year shall not exceed 15 per cent of the total number of branches as on March 31 of the previous financial year, subject to a minimum of one branch and a maximum of ten branches.
The Directions further specify that all existing branches of the bank must have valid authorisation from the RBI. Separate conditions have been prescribed for StCBs and District Central Co-operative Banks (DCCBs) with regard to the location of branches.
The Directions state that banks which do not meet the ECBA requirements shall require prior approval from the RBI for opening branches. The 2025 Directions consolidate and supersede earlier instructions on branch authorisation applicable to Rural Co-operative Banks.
