Module: General Practice
Q2: Consider the following statements regarding the regulatory framework of the Lead Bank Scheme:
Statement 1: A bottom-up approach is central to the LBS, requiring the estimation of block-wise and activity-wise potential to prepare targeted credit plans.
Statement 2: The draft explicitly mandates that the designated Lead Bank for every district must strictly be a Public Sector Bank (PSB).
Statement 3: The Reserve Bank of India originally introduced the Lead Bank Scheme in the year 1969.
Statement 4: Stakeholders have been given a defined timeline to submit their comments on the revised draft guidelines by March 6, 2026.
Which of the above statements is/are correct?
Statement 2: The draft explicitly mandates that the designated Lead Bank for every district must strictly be a Public Sector Bank (PSB).
Statement 3: The Reserve Bank of India originally introduced the Lead Bank Scheme in the year 1969.
Statement 4: Stakeholders have been given a defined timeline to submit their comments on the revised draft guidelines by March 6, 2026.
Which of the above statements is/are correct?
✅ Correct Answer: B
🎯 Quick Answer:
Statements 1, 3, and 4 are correct. Statement 2 is incorrect. (Option B)Structural Breakdown: Any commercial bank with a significant presence in a district can be assigned as the Lead Bank.
It is not exclusively reserved for Public Sector Banks (PSBs); private sector banks can also be designated as Lead Banks depending on their branch network and capability in that region.
Historical / Static Context: Initiated in 1969, the LBS was India's first major step toward localized and coordinated banking, shifting the focus from elite urban lending to rural and semi-urban mass banking.
The Dynamic Update (NEW) & Data: The February 2026 draft reinforces the bottom-up credit planning approach (Statement 1) and clarifies that the RBI will designate a "commercial bank" as the Lead Bank (invalidating Statement 2, which incorrectly limits this to PSBs). The hard deadlines tested include the scheme's inception year (1969) and the strict public feedback submission deadline of March 6, 2026.