RRBs' gross loans rise 10.3% to Rs5.78 lakh crore in FY26

Regional Rural Banks (RRBs) recorded robust growth in credit delivery during 2025-26, with gross loans outstanding rising 10.3 per cent to Rs5.78 lakh crore from Rs5.24 lakh crore in the previous financial year, according to data released by the Ministry of Finance on Tuesday.The latest figures highlight the expanding role of RRBs in strengthening rural credit, particularly in agriculture, micro-enterprises and other underserved sectors of the economy.RRBs also continued to outperform under the Reserve Bank of India's Priority Sector Lending (PSL) framework. Their average achievement against the overall PSL target of 75 per cent of Adjusted Net Bank Credit (ANBC) stood at 91.7 per cent during FY2025-26, with almost all RRBs meeting the prescribed target.
Agriculture and allied activities remained the largest beneficiaries of RRB lending, accounting for the biggest share of the priority-sector credit portfolio,according to the official data.Outstanding credit to agriculture and allied activities stood at Rs3.78 lakh crore, representing 77 per cent of total priority-sector lending. Farm credit alone accounted for nearly 98 per cent of agricultural lending, supporting crop cultivation, allied activities and investments across the rural economy.The data underlines the critical role played by RRBs in providing institutional finance to farmers and sustaining agricultural growth.
Meanwhile,RRBs also maintained a strong focus on the micro, small and medium enterprises (MSME) sector, with outstanding credit reaching Rs66,978 crore, or 13.6 per cent of total priority-sector lending.More than 95 per cent of MSME financing was directed towards micro-enterprises, including first-generation entrepreneurs, artisans, self-employed individuals and small business units operating in rural and semi-urban areas.Within the MSME portfolio, the services sector accounted for the largest share of lending, followed by manufacturing enterprises and Khadi and Village Industries.The continued flow of institutional credit to micro-enterprises is expected to boost rural entrepreneurship, generate employment and improve access to formal financing for small businesses, noted experts.
RRBs extended Rs3.49 lakh crore in credit to weaker sections during FY2025-26, reaffirming their commitment to financial inclusion and equitable access to institutional finance.
Apart from agriculture and MSMEs, RRB lending also supported sectors such as housing, education, renewable energy and social infrastructure. These areas contribute to household asset creation, human capital development, clean energy adoption and the creation of local infrastructure. The overall performance of RRBs during FY2025-26 reflects sustained expansion in rural credit and continued alignment with the country's development priorities.

(Business Correspondent)