RBI relaxes for opening new bank branches in Tier I cities

Now banks will have freedom to open branches in tier-I cities (those with population over 1 lakh) without seeking RBI’s approval in each case.
However, as per RBI guidelines, there are some conditions on opening branches, these are stipulated below:

  • Banks should open 25% of their branches in a financial year in Un-banked tier-V and tier-VI centres as earlier.
  • Total number of branches in tier –I centre’s can’t exceed the number of branches opened in tier-2 to tier-6 centres during a year.
  • If the banks are unable to open all tier – 1 branches during that year, they can carry it over for next 2 years.
  • If the banks unable to open requisite branches in tier- II to tier- VI centres for some reason, it should necessary correct the shortfall in the next financial year.



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