The Reserve Bank of India (RBI) has issued directives to the Nagar Sahakari Bank Ltd in Etawah, restricting the bank from granting or renewing loans, making investments, or incurring liabilities without prior written approval from the RBI. The bank is also prohibited from disbursing payments, entering into compromises, or selling assets without following the specified RBI Direction dated May 15, 2026.
In light of the bank’s current liquidity situation, depositors are allowed to withdraw up to Rs 10,000 from their accounts, with the option to set off loans against deposits as per the conditions outlined in the RBI Directions. Essential expenses like employee salaries, rent, and electricity bills are permitted under these guidelines.
These measures have been implemented by the RBI due to supervisory concerns arising from recent developments at the bank, aimed at safeguarding the interests of depositors. Despite previous engagements with the bank’s Board and Senior Management to enhance operations, the lack of concrete actions prompted the issuance of these Directions.
Depositors eligible for deposit insurance can claim amounts up to Rs 5,00,000 under the DICGC Act, 1961, subject to verification and submission of willingness. For further details, depositors are advised to contact bank officials. These directives will be effective for six months from May 18, with provisions for review.
Meanwhile, the RBI has imposed a monetary penalty of Rs 20,000 on the Aurangabad District Central Co-operative Bank Limited in Bihar for failing to comply with RBI directives on ‘Credit Information Reporting’.
