Regional Rural Banks Credit Performance FY 2025–26

Regional Rural Banks (RRBs) demonstrated strong credit growth during FY 2025–26, with gross loans outstanding increasing by 10.3% from ₹5,24,163 crore in FY 2024–25 to ₹5,78,349 crore in FY 2025–26. The banks maintained exceptional performance under the Reserve Bank of India's Priority Sector Lending framework, achieving an average of 91.7% of Adjusted Net Bank Credit against the prescribed target of 75%, with almost all RRBs meeting the overall PSL target.

Agriculture and allied activities remained the dominant component of RRB lending, with outstanding credit reaching ₹3.78 lakh crore, representing 77% of total Priority Sector Lending. Within this category, farm credit accounted for nearly 98% of agricultural lending, supporting crop cultivation, allied agricultural activities, and rural economy investments.

The MSME sector received ₹66,978 crore in credit, constituting 13.6% of total PSL, with over 95% of this lending directed specifically toward micro enterprises. This emphasis reflects RRBs' focus on financing first-generation entrepreneurs, self-employed individuals, artisans, and small business units in rural and semi-urban areas. Within MSME lending, the services sector accounted for the largest share, followed by manufacturing enterprises and Khadi & Village Industries.

Credit to weaker sections reached ₹3.49 lakh crore, reaffirming RRBs' commitment to financial inclusion and equitable access to institutional credit. Additionally, lending continued for housing, education, renewable energy, and social infrastructure, supporting inclusive and sustainable development through human capital formation, household asset creation, clean energy adoption, and local infrastructure development.

The financial performance highlights RRBs' sustained expansion in rural credit, strong alignment with national development priorities, and continued support to farmers, micro-enterprises, and underserved segments, positioning them as key pillars in advancing financial inclusion and strengthening rural livelihoods.