Mumbai: Reserve Bank of India (RBI) deputy governor H.R. Khan on Thursday said regional rural banks (RRBs) which are investing in core banking solutions (CBS) can get an extension if there is a need to provide it.
“If there is a need, we will look at that. If you tell from now that we will give extension, the momentum would be lost. So, if there is a need, we shall look at an extension (of the September deadline),” he told reporters on the sidelines of a Federation of Indian Chambers of Commerce and Industry (Ficci) - Indian Banks’ Association (IBA) event here.
An RBI committee had suggested that all RRBs move to the core banking platform by September 2011, a move that would help these banks undertake 90% of their business on this platform. The committee noted that difference in computerization level among different RRBs would have to be taken into account for any technology upgrade.
The panel had suggested an application service provider model for the CBS platform. The sponsor banks were given the option to choose their own service provider for their RRBs.
On Wednesday, during the same summit, National Bank for Agriculture and Rural Development (Nabard) chairman Prakash Bakshi had said he expected RRBs to miss the September deadline for implementing the CBS platform by three months. Bakshi had added that Nabard was providing an assistance of 40% from the Financial Inclusion Technology Fund to the RRBs to adopt the CBS platform.