Maharashtra’s leading multi-state scheduled bank, Nasik Merchants Co-operative Bank (popularly known as Namco Bank), is gearing up for a landmark transformation. The bank has outlined an ambitious plan to convert itself into a Small Finance Bank (SFB) under the Companies Act, moving away from the cooperative framework it has followed for decades.
The proposal, already cleared by the board, will be placed before members at the Annual General Meeting (AGM) scheduled for September 20.
While approval from members appears likely, the bigger challenge lies in obtaining a No Objection Certificate (NoC) from the Central Registrar of Cooperative Societies (CRCS). Several multi-state cooperative banks seeking similar conversions have been awaiting the CRCS nod for years, leaving uncertainty over the timeline.
A senior official of Namco Bank, speaking to Indian Cooperative, emphasized that the institution is financially strong and well-prepared for this transition. For FY 2024–25, the bank achieved a business turnover of Rs 3,761.24 crore, reflecting growth of Rs 537 crore compared to the previous year.
Net profit stood at Rs 41.80 crore as of March 2025, while gross NPAs were 4.40% and net NPAs remained at zero. With a membership base nearing two lakh, the official noted, Namco has a solid foundation for the next phase of growth.
The official further explained that operating under the Companies Act will provide greater operational flexibility and stricter accountability. Directors will be selected in accordance with company law, and responsibility for irregularities will rest on individuals rather than the entire board.
Despite this, the plan has drawn criticism from some former directors and members, who argue that the move is aimed at bypassing recently introduced cooperative regulations, particularly the 10-year cap on board tenures.
They contend that the conversion would enable the current leadership to sidestep these restrictions. Bank management, however, insists that the proposal is designed to strengthen the institution, expand its reach, and deliver broader benefits to stakeholders.
If approved, Namco Bank will gain the ability to extend credit to farmers, accept deposits from government departments and cooperative banks, and provide greater financial benefits to its shareholders. According to officials, Namco is currently the only bank in Nashik district that meets all RBI requirements for conversion into an SFB.
The AGM will also deliberate on a merger plan involving two Nashik-based co-operative banks: the Nashik District Mahila Co-operative Bank, recognized for its contribution to women’s empowerment, and the financially constrained Shri Ganesh Sahakari Bank. Should members and the respective institutions agree, the consolidation would further strengthen Namco’s base ahead of its proposed transformation into a Small Finance Bank.
The upcoming AGM will be crucial, with key items on the agenda such as giving the board authority to take decisions on merging cooperative banks within and outside Maharashtra, approving the transition of Namco Bank into a Small Finance Bank under the RBI scheme, and finalizing a list of members who will serve as promoters for setting up the new public limited company required for the transition.
