Which of the following institutions in India acts as the principal regulator for cooperative banks in both urban and rural areas, working alongside the central bank?

💡 Solution & Explanation

The National Bank for Agriculture and Rural Development exercises statutory regulatory supervision over regional rural banks and state cooperative banks alongside the Reserve Bank of India under the NABARD Act of 1981. Institutions like SIDBI focus on micro, small, and medium enterprises rather than agricultural and cooperative banking structures. Ultimate banking regulation powers over all banking institutions remain vested in the Reserve Bank of India pursuant to the Banking Regulation Act of 1949.