The government and the Reserve Bank of India (RBI) have implemented measures to bolster the financial health, governance, and digital inclusion of cooperative banks. Minister of State for Finance, Pankaj Chaudhary, informed the Parliament about steps taken to enhance deposit security, credit availability, and prudent regulation. Loans provided to the National Cooperative Development Corporation (NCDC) by banks are now classified as priority sector lending, benefiting cooperative societies.
Urban Cooperative Banks (UCBs) have received permission to expand by opening new branches, and their housing loan limits have been raised from 10% to 25% of total loans and advances. Amendments to the Banking Regulation Act have extended the term of directors of Cooperative Banks from 8 to 10 years. Additionally, the licensing fee for onboarding cooperative banks to the Aadhar-enabled Payment System (AePS) has been reduced.
The National Urban Co-operative Finance and Development Corporation Limited (NUCFDC) has been established to serve as an Umbrella Organisation for Urban Cooperative Banks, offering Information Technology (IT) infrastructure and operational support. Rural Cooperative Banks have been included in the Integrated Ombudsman Scheme by the RBI. ‘Sahakar Sarthi’ has been set up to provide technological services to Rural Cooperative Banks, and the Deposit Insurance and Credit Guarantee Corporation (DICGC) ensures deposits up to Rs 5,00,000 per depositor per bank for all cooperative banks.
