Responsible Banking

Ongoing engagements in Sustainable Finance:

As a step towards inclusive and sustainable growth, the Bank has established a dedicated line of credit for financing –

• Climate smart loans

• Sustainable agricultural loans

• Strong micro banking portfolio aimed at hitherto unbanked women

• Financial literacy activities to empower women with financial knowledge on savings and financial products

• Funding Sustainable Agricultural Practices and Businesses

The Bank is active in disbursal of loans from climate smart credit lines and in sectors like renewable energy, electric vehicles and agriculture, which results in emission reductions and delinking the economic growth from GHG emissions.

As a part of a larger climate risk agenda and green lending initiatives, the Bank has also made its foray into sustainable agricultural loans aimed at climate-friendly agricultural practices that optimize water usage and energy efficiency.

The Bureau of Energy Efficiency (BEE), Government of India has set up a Facilitation Centre (FC) for promotion of BEE financing schemes. RBL Bank has already joined this initiative as a financial institution. This will give the Bank access to potential borrowers, who require loans to pre-screened energy efficiency projects.

Financial Inclusion and Financial Literacy:

The Bank’s Credit Policy for Financial Inclusion (FI) Business guides the Financial Inclusion efforts. FI activities are aimed towards improving the quality of life of lower income groups in India’s rural and semi-rural areas by honing their entrepreneurial skills. The Bank’s financial inclusion efforts are also supported by financial literacy (FL) training of clients. This, in the long run, helps borrowers to access mainstream finance and improve income levels.

Various financial inclusion products (like microfinance, micro-banking & no-frills accounts, micro-enterprise financing, micro-savings and remittances, crop, life and accident insurance products etc.) have been rolled out by the Bank for underprivileged, under-banked and unbanked sections of the society. The Bank also operates micro- ATMs for these segments of customers.

RBL Bank is actively engaged in transformative programs aimed at extending formal credit access to small and marginal farmers across rural India. Through strategic collaborations and innovative financial models, we work to integrate underserved farming communities and agricultural societies into the mainstream banking ecosystem. These initiatives focus on enabling inclusive rural development by offering tailored lending solutions, capacity-building support, and financial literacy. By bridging the gap between informal and formal credit channels, we empower farmers to invest in better inputs, adopt sustainable practices, and improve their livelihoods.

The Bank has engaged with Non-Government Organisation (NGO) for conducting Financial Literacy training programmes in the state of Madhya Pradesh. The target audience for these programmes are the marginalized - and economically weaker sections of society, especially women in small self-help/ joint liability groups. These programmes are designed to meet following objectives:

• Introduce them to basic financial products like savings account, loan account, term deposits and insurance

• Explain concepts of financial discipline to help manage their money in a responsible manner

• Improve their access to credit through formal channels to avoid exploitation by money-lenders

• Educate with respect to usage of banking services through alternate channels like mobile ATMs or SMS

Ensuring a diverse and inclusive workplace

RBL Bank’s Diversity and Inclusion (‘D&I’) Practice

D&I practices were included in the Bank’s ESG committee’s scope in 2017. The Bank hired a full-time D&I Head in 2018. Bank has also developed a Gender Action Plan (GAP) in FY20.

In 2020, RBL Bank partnered with BII (formerly CDC) under the 2X Challenge, aiming for 40% women representation by FY25. While progress has been made, a recent review of workforce trends and market conditions has led to a revised target of 30% by 2027, reflecting a more realistic and sustainable goal.

To achieve this, we will focus on five key pillars:

Managing climate change impacts

Climate Risk & Task Force for Climate related Financial Disclosure (TCFD)

RBL Bank became a TCFD supporter:

From August 2022, the Bank is a supporter of Task Force on Climate-related Financial Disclosures (TCFD). TCFD recommendations are based on four pillars – governance, strategy, risk management, and metrics and targets. Given its remit from the Financial Stability Board, the TCFD is committed to market transparency. The RBI has also recommended adoption of the TCFD framework by Indian banks in its new climate risk consultation paper.

Measures to contain Bank’s own carbon footprint:

The bank has undertaken many initiatives for reducing GHG emissions within its own operations. A few notable initiatives and their potential impacts are summarized below:

• Green buildings: Three of our largest offices by carpet area – Corporate Office, Airoli and NOC Goregaon (all in Mumbai Metropolitan Region) are situated in certified green buildings. This is about 51% of the carpet area among our all the regional offices (barring branches) and 17% of all carpet area, inclusive of all India branches.

• The 8th floor of NOC, Goregaon office is using 100% renewable energy from September 2022. Similarly, CO, Parel and Airoli are also on 100% renewable energy. With a monthly consumption of 2.16 lakh units, this initiative will help avoid emissions of 1,575 tCO₂ annually.

• Solar roof top in branches: The bank has installed solar panels in its 24 branches, generating about 268 MWh of solar power and thus avoiding GHG emissions of 195 tCO₂. In addition, the bank finances various renewable energy, other emission reduction projects and electric vehicles etc. These in turn also help reduce the total GHG emissions. The third-party data centers used are also Green Certified and use significant renewable energy for their operations.

In addition to above, the Bank finances various renewable energy, electric vehicles and other emission-reduction projects etc. This in turn also helps reduce total GHG emissions.

With a third-party benchmarking exercise on global best practices to implement TCFD recommendations, the Bank has developed a short-term action plan with some of the high-level objectives as below:

• E&S Risk team to drive climate risk management across the Bank: Climate risk-related goals have been incorporated in E&S Risk team’s KRAs, while responsibility of oversight rests with the Executive Director.

• Internal capacity development to address climate risk: The Bank is in continuous process of developing internal capacity building on climate risk by imparting specialized training.

• Develop a plan for addressing portfolio and transaction-level climate risks: The Bank has initiated and added climate risk assessment at transactional level within its internal E&S Risk rating grade. Additionally, the Internal Credit Rating system of the bank has also been integrated with the external ESG Scores provided by SEBI registered ERPs wherever available.

• Develop targets to reduce own CO₂ emission intensity: The Bank’s E&S risk team along with corporate services team is working towards reducing environmental impact of own operations, e.g., energy intensity

RBL Bank will continue to strengthen its climate risk management practices by assimilating it in existing risk management framework.

RBL Bank realises importance of biodiversity to sustain life on earth and has included following initiatives that have negative impact in its exclusion list (not eligible for funding).

1) Production of or trade in any product or activity deemed illegal under host country laws or regulations or international conventions and agreements
2) Trade in wildlife or wildlife products regulated under CITES (Convention on International Trade in Endangered Species of Wild Fauna and Flora)
3) Purchase of logging equipment for use in primary tropical moist forest
4) Commercial logging operations for use in primary tropical moist forest
5) Production of or trade in pesticides/herbicides subject to international phase-outs or bans
6) Drift net fishing in the marine environment using nets in excess of 2.5 km. in length
7) Production of or trade in wood or other forestry products from unmanaged forests

Also, RBL Bank is a Primary Member of the Sustainable Palm Oil Coalition for India (I-SPOC). The members of I-SPOC commit to the goal - "Promote Sustainable Consumption and Trade of Palm Oil and its Derivatives in India along the Supply Chain". Please see various initiatives of the members on website: https://www.indiaspoc.org/about