Vol. 6, Issue 3, Part G (2020)

Rural banking is the practice of offering financial services, such as banking and financial goods, to underserved and rural sections of a nation. Given the size of the country's rural population and the necessity to support financial inclusion and economic development in these areas, rural banking is a vital part of the broader banking system in India. In order to provide inhabitants with essential financial services without requiring them to go to urban centres, banks open branches and other banking facilities in rural areas. Common names for these locations include "rural branches" or "rural banking outlets." The goal of rural banking is to include underserved groups and individuals in the formal banking system. By providing them with access to savings accounts, fundamental credit options, insurance products, and other financial services, this is accomplished.

Members of rural communities manage and own the specialist banks known as rural co-operative banks. They frequently collaborate closely with local communities to offer credit and other banking services since they are created to meet the unique financial needs of rural people. Microfinance organizations, in addition to conventional banks, are important players in rural banking. They provide people without access to official credit sources with small loans and financial services, enabling them to engage in income-generating activities and enhance their quality of life.