The Reserve Bank of India (RBI) has imposed regulatory restrictions on Loknete R.D. (Appa) Kshirsagar Sahakari Bank , Niphad, Nashik district, under Section 35A read with Section 56 of the Banking Regulation Act, 1949. The Directions, issued on December 15, 2025, come into force from the close of business on December 16, 2025, and will remain effective for six months.
Under the Directions, the bank is prohibited from granting or renewing loans and advances, making investments, accepting fresh deposits, incurring liabilities, or disposing of assets without prior RBI approval. Withdrawals from savings, current, or any other depositor accounts have also been disallowed, though the bank may set off loans against deposits as per conditions specified by RBI. Certain essential expenditures such as employee salaries and utility bills are permitted.
The RBI stated that the action was taken due to material supervisory concerns and to protect depositors’ interests.
Eligible depositors will be entitled to deposit insurance up to Rs 5 lakh from DICGC. The RBI clarified that the Directions do not amount to cancellation of the bank’s licence.
