Urban Co-operative Banks (UCBs) had high expectations from the Union Budget, particularly regarding long-pending demands aimed at strengthening the cooperative banking sector, said Adv. Subhash Mohite, Honorary Secretary of the Pune Urban Co-operative Banks Association.
Reacting to the Budget, Mohite said UCBs were hopeful of income tax exemption under Section 80P, substantial financial support for cyber security and digitalisation, permission to function as mutual fund distributors, and authorisation to implement government schemes. He noted that these measures would have significantly enhanced financial inclusion and operational sustainability of UCBs.
Additionally, allowing UCBs to appoint Primary Agricultural Credit Societies (PACS) as Business Correspondents would have helped extend banking services more effectively to rural and semi-urban areas.
However, Mohite expressed disappointment that none of these issues found mention in the Union Budget.
At the same time, he welcomed the announcement regarding the constitution of a high-level committee for the banking sector. He stressed that for the committee to be effective, it is essential to include experts who are actively working within the cooperative banking sector, so that the unique challenges and requirements of UCBs are adequately represented.