In a significant regulatory move, the Reserve Bank of India (RBI) has tightened oversight on five co-operative banks, issuing fresh directions to three and extending restrictions on two others under Section 35A read with Section 56 of the Banking Regulation Act, 1949.
Fresh directives have been imposed on Samarth Sahakari Bank Ltd., Solapur, Samarth Urban Co-operative Bank Ltd., Osmanabad (both in Maharashtra), and Sadbhav Nagrik Sahakari Bank Maryadit, Chhatarpur (Madhya Pradesh). Effective from October 7, 2025, these banks are barred from granting loans, accepting fresh deposits, or incurring liabilities without prior RBI approval.
Considering their liquidity stress, the RBI has completely barred withdrawals for the two Samarth banks, while Sadbhav Bank depositors may withdraw up to Rs 5,000 only.
The RBI stated that despite previous supervisory engagements, the banks failed to take adequate corrective measures, prompting these stringent curbs to safeguard depositors’ interests. All three banks will remain operational under restrictions for six months, subject to review. Eligible depositors are assured coverage up to Rs 5 lakh under the Deposit Insurance and Credit Guarantee Corporation (DICGC) scheme.
Meanwhile, the RBI has extended existing restrictions on Ramgarhia Co-operative Bank Ltd., New Delhi, and The Shirpur Merchants’ Co-operative Bank Ltd., Shirpur, Maharashtra, for a further three months till January 8, 2026.
The central bank emphasized that these directives aim to protect public interest and financial stability, underscoring its continued vigilance over the health of the co-operative banking sector.
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