The concept of RSETIs has been inspired by the very successful RUDSETI model promoted by SDME Trust, SyndicateBank and Canara Bank way back in1982 at Ujire in Karnataka. The RUDSETI has trained over 3.91 lakh unemployed youth in various activities across the country through its 27 Institutes. RUDSETI’s philosophy is to motivate the unemployed rural youth to take up self-employment through short term training intervention with long term hand-holding. The programmes are basically residential in nature with free food, accommodation and training where the unemployed youth are trained not only in the skill he is interested but also in giving him the behavioural inputs / soft skills to make him capable of starting his own venture with or without bank finance. The cutting edge of RUDSETI lies in the settlement rate of the trained youth which is an amazing 69%. The very fact that RUDSETI which is silently contributing to the welfare of the society by addressing the unemployment problem, has caught the attention of the policy makers, both at the State and the Central Government which is a matter of pride for the sponsors of RUDSETI concept. Inspired by the high settlement rate of 69% of the trained candidates of RUDSETI and its unique approach in addressing the unemployment problem, the Ministry of Rural Development which is committed to ensure the growth and development of rural areas with special focus on developing self-employment opportunity for the unemployed rural youth decided to establish one Rural Self-Employment Training Institute (RSETI) replicating the RUDSETI model in each district of the country. While the Lead Bank operating in the District has been assigned with the responsibility of opening a RSETI in the district, the Government of India has agreed to sanction Rs. Two crores as infrastructure fund for construction of the campus besides reimbursing the cost of training BPL youth. The State Governments concerned have been advised to provide land free of cost to the RSETIs. The sponsoring banks of the RSETIs in each District have been advised to meet the cost of running these Institutes, deputing an officer to work as Director of RSETI, providing requisite supporting staff at each RSETI and most importantly to ensure credit linkage of the RSETI trained candidates.

The RSETIs have been entrusted with the task of training minimum of 750 BPL youth each year with a minimum settlement rate of 50% to begin with and to reach 70% at the end of third year of its operation. However, being promoted by different banks, these RSETIs are following different norms of training and as a consequence the outcomes are also different. While the banks are monitoring only the financial aspects of RSETIs, the quality aspect of training is not being monitored closely. Thus a need was felt to introduce an effective mechanism for monitoring the activities of RSETIs in order to ensure uniform standards of training and settlement rates across the country. This would also involve a systematic capacity building of Directors/Faculty members of RSETIs to ensure that all the RSETIs are brought on par with the best performing RUDSETIs in the country in a time bound manner.