Journal of Microfinance / ESR Review


Efforts to reform India's failing Regional Rural Banks (RRBs) have had limited impact, because reformers have paid little attention to the institutional dimensions of the problems facing the banks. Few efforts were made to redesign the perverse institutional arrangements that gave rise to incompatible incentive structures for key stakeholders, such as political leaders, policy makers, stockholders, bank staff, and clients. We recommend that the next leg of reforms focus on aligning the incentives of these stakeholders by giving greater importance to the RRBs' internal organizational contexts and larger policy environments.


Nitin Bhatt is Manager with Grant Thornton, LLP's Entrepreneurial Consulting Services Practice in Los Angeles, and former Executive Director of University of Southern California's Business Expansion Network.; Y. S. p.Thorat is Regional Director of the Reserve Bank and former Additional Chief General Manager of RBI's Rural Planning and Credit Department.



Journal Title

Journal of Microfinance

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