The All-India Bank Employees’ Association (AIBEA) has urged the Central and State Governments to jointly establish a dedicated recapitalisation fund for cooperative banks, calling it essential to strengthen the sector’s financial health and ensure its long-term sustainability.
The demand forms part of a comprehensive resolution adopted at AIBEA’s 30th Conference held in Bengaluru, which also sought a National Policy for Cooperative Banking Institutions, structural reforms and improved welfare measures for cooperative bank employees.
Describing cooperative banks as a crucial pillar of India’s banking system, particularly in rural areas, AIBEA welcomed the creation of the Ministry of Cooperation and the enhanced supervisory powers granted to the Reserve Bank of India through the 2020 amendments to the Banking Regulation Act.
However, it cautioned that provisions allowing cooperative banks to raise capital from the market could eventually lead to the privatisation of the sector.
Among its other demands, AIBEA sought timely reimbursement to cooperative banks for government-announced loan waivers, the formulation of a National Policy for Cooperative Banking Institutions, and the introduction of an index-linked pension scheme for all cooperative bank employees.
