Regional Rural Banks (RRBs) continued to expand their role in rural development and financial inclusion during FY 2025–26, with strong growth in credit delivery and sustained focus on Priority Sector Lending (PSL).
Gross loans outstanding of RRBs increased 10.3%, rising from Rs 5,24,163 crore in FY 2024–25 to Rs 5,78,349 crore in FY 2025–26. Their performance under the Reserve Bank of India’s PSL framework also remained robust, with the average achievement against the prescribed overall PSL target of 75% reaching 91.7% of Adjusted Net Bank Credit (ANBC). Almost all RRBs met the overall PSL target during the year.
Agriculture Remains Key Focus
Agriculture and allied activities continued to account for the largest share of RRB lending, with outstanding credit reaching Rs 3.78 lakh crore, representing 77% of total PSL. Farm credit made up nearly 98% of agricultural lending, supporting crop cultivation, allied activities and investments across the rural economy.
Credit extended to the MSME sector stood at Rs 66,978 crore, accounting for 13.6% of total PSL. More than 95% of MSME lending was directed towards micro enterprises, supporting first-generation entrepreneurs, self-employed individuals, artisans and small businesses across rural and semi-urban areas.
Within the MSME segment, the services sector received the largest share of credit, followed by manufacturing enterprises and Khadi & Village Industries.
Strong Support for Weaker Sections
RRBs provided Rs 3.49 lakh crore in credit to weaker sections, reinforcing their role in expanding access to institutional finance and promoting financial inclusion.
Lending towards housing, education, renewable energy and social infrastructure also continued to contribute to inclusive and sustainable development by supporting human capital, household asset creation, clean energy adoption and local infrastructure.
Overall, RRBs recorded sustained expansion in rural credit during FY 2025–26, while maintaining alignment with national development priorities. Their continued lending to farmers, micro-enterprises and underserved communities reinforces their importance in strengthening rural livelihoods, expanding financial inclusion and supporting balanced economic growth.