Union Minister of State for Finance Pankaj Chaudhary informed the Rajya Sabha about the current financial condition of cooperative banks, citing data from RBI and NABARD.
As of December 31, 2024, Urban Cooperative Banks (UCBs) held total assets of Rs 7,20,141 crore and total deposits of Rs 5,59,954 crore, reporting a net profit of Rs 4,130 crore. Their Capital Adequacy Ratio (CRAR) stood at 17.5%, while the Gross NPA Ratio was 9.2%, and the Net NPA Ratio was 3.7%.
For State Cooperative Banks (StCBs) (as of March 31, 2024), the total assets were Rs 4,88,266 crore, with total deposits of Rs 2,56,819 crore. The net profit was Rs 2,691 crore, with a CRAR of 12.9%, a Gross NPA Ratio of 4.9%, and a Net NPA Ratio of 2.0%.
District Central Cooperative Banks (DCCBs) recorded total assets of Rs 7,65,577 crore and total deposits of Rs 4,76,610 crore, with a net profit of Rs 1,894 crore. Their CRAR stood at 11.9%, Gross NPA Ratio at 8.9%, and Net NPA Ratio at 3.4%.
To ensure better regulation and governance, the Banking Regulation (Amendment) Act, 2020 has empowered RBI with additional authority over cooperative banks in areas like management, audit, capital, and amalgamation. These provisions have been in force for UCBs since June 26, 2020.
To combat fraud and irregularities, RBI has introduced Master Directions on Fraud Management (2024), which focus on early warning mechanisms, fraud reporting, and staff accountability. Additionally, the Prompt Corrective Action (PCA) Framework ensures timely remedial actions for financially weak UCBs.
To protect depositors, Deposit Insurance through DICGC has been implemented, and awareness campaigns like “RBI Kehta Hai” educate stakeholders on financial frauds.
The Multi-State Cooperative Societies (MSCS) Act, 2002, has been amended to enhance governance, transparency, and accountability. A Cooperative Ombudsman has been appointed to handle complaints, while the Cooperative Election Authority ensures free and fair elections in MSCS.
Additionally, NABARD has introduced fraud reporting guidelines, directing cooperative banks to report financial irregularities to law enforcement agencies for swift action.