The Lead Bank Scheme, initiated by the RBI in 1969, designates a bank with the most branches in a district to coordinate credit flow to priority sectors and weaker sections of the economy. The scheme involves a two-phase approach: surveying banking potential in the district and preparing credit plans to enhance productivity and support employment. It aims to empower lead banks as key players in rural development by formulating loan schemes and fostering collaboration among various banks.

1. LEAD BANK SCHEME
BY :
AREPALLI NAVEEN KUMAR

2. The Lead bank
• To put in simple terms, in order to co-
ordinate the efforts of all the Banks in a
district, towards,among others, the flow of
credit to all the priority sectors of economy
particularly the weaker sections, a Bank
having maximum number of branches in the
district is designated as a lead Bank by RBI.

3. The lead Bank scheme
• The study group appointed by National
Credit Council (NCC) in 1969 under the
chairmanship of Prof. D.R.Gadgil
recommended “Service Area Approach”
for the development of financial structure.
• In the same year i.e., 1969, RBI
appointed Sri. F.K.F Nariman committee
to examine recommendations of Prof.
Gadgil’s study group.

4. CONTD…..
• The Nariman committee also endorsed the
views of the Gadgil committee on “Service
Area Approach” and recommended the
formulation of “Lead Bank Scheme”. The
RBI accepted the Nariman’s committee
recommendations and lead bank scheme
came into force from 1969.
. Under the lead bank scheme, specific
districts are allotted to each bank, which
would take the lead role in identifying the
potential areas for banking and expanding
credit facilities.

5. CONTD……
• Lead bank is the leading bank among the
commercial banks in a district i.e. having
maximum number of bank branches in the
district. Lead bank acts as a consortium
leader for coordinating the efforts of all
credit institutions in the each allotted
district for the development of banking and
expansion of credit facilities.

7. The activities of lead bank can be
handled under two important phases
Phase I: Survey of the lead district
Phase II-Preparation of credit Plans

8. Phase I: Survey of the lead
district
• The RBI has mentioned the following
functions of leadbank underphase-I
. Surveying the potential areas for banking
in the district.
. Identifying the business establishments
which are so far dependent on non –
institutional agencies for credit and
financing them so as to raise their income

9. • Examining the available marketing facilities
for agricultural and industrial products and
linking credit with marketing.
.Invoking cooperation among different banks
in opening new bank branches.
.Estimating the credit gaps in various
sectors of district economy.
.Developing contacts and maintaining
relationship with the Government and other
agencies.
CONTD…..

10. Phase II- Preparation of credit
Plans
• RBI emphasized that the lead bank should
Formulate the bankable loaning schemes
involving intensive use of labour, so as to
generate additional employment.
• Disburse loans to increase the productivity
of land in Agriculture and allied activities, so
as to increase the income level.
• Give maximum credit to weaker sections of
the society mainly for productive purposes.

11. CONTD…..
• Therefore lead bank scheme
expects the banker to become an
important participant in the
developmental process in the area
of its operation in rural areas, and
the service area approach put the
banker in the position of
implementing the development
plans.

12. District Wide Lead Bank List Of Karnataka
State
SR. District Name Name of Lead Bank
1. Bagalkot Syndicate Bank
2 Bengaluru [Rural] Canara Bank
3. Bengaluru [Urban] Canara Bank
4. Belagavi Syndicate Bank
5. Ballari Syndicate Bank
6. Bidar State Bank of India
7. Vijayapura Syndicate Bank
8. Chamarajanagara State Bank of Mysore
9. Chickballapura Canara Bank
10. Chickmagalur Corporation Bank
11. Chitradurga Canara Bank
12. Dakshina Kannada Syndicate Bank
13. Davanager Canara Bank
14. Dharwad Vijaya Bank
15. Gadag State Bank of India
16. Gulbarga State Bank of India

13. CONTD..…
SR. District Name Name of Lead Bank
17. Hassan. Canara Bank
18. Haveri Vijaya Bank
19. Kodagu Corporation Bank
20. Kolar Canara Bank
21. Koppal State Bank of Hyderabad
22. Mandya Vijaya Bank
23. Mysuru State Bank of Mysore
24. Raichur State Bank of Hyderabad
25. Ramanagara Corporation Bank
26. Shivamogga Canara Bank
27. Tumakuru State Bank of Mysore
28. Udupi Syndicate Bank
29. Uttara Kannada Syndicate Bank
30. Yadgir State Bank of India

14. Reference :
• https://www.google.com/url?sa=t&source=web&rct=j&url=h
ttps://www.rbi.org.in/upload/Publications/PDFs/35608.pdf&v
ed=2ahUKEwiWtKyKpfHwAhWPYysKHRTlBKAQFjAKegQIH
RAC&usg=AOvVaw1QgiAAza9Hhlw0MmUzIrOP
• https://www.google.com/url?sa=t&source=web&rct=j&url=h
ttps://msmedibangalore.gov.in/files/Lead-Banks-Cotact-
details.pdf&ved=2ahUKEwiWtKyKpfHwAhWPYysKHRTlBK
AQFjALegQIHxAC&usg=AOvVaw1InVkgOKelXGgzE7NqKEd
4
• http://www.slideshare.net/NISHANTHSEKAR1/lead-bank-
scheme-77002293?from_m_app=android
• https://www.google.com/url?sa=t&source=web&rct=j&url=h
ttp://agcollegejagtial.weebly.com/uploads/4/6/5/5/46554149/
aeco_142.pdf&ved=2ahUKEwjL0oSzt_HwAhWMXCsKHdE7
DzkQFjAAegQIAxAC&usg=AOvVaw2tnxtg5wpSpJPLKV7kN