Highlighting the crucial role of cooperative banks in India’s economic growth, Vidyadhar Anaskar, Chairman of the Administrative Board of Maharashtra State Cooperative Bank, has emphasized that these institutions are instrumental in transforming idle money into productive use.
His article, inspired by the recent report “Charting New Frontiers” by BCG, FICCI, and the Indian Banks’ Association (IBA), underscores the need for the banking sector to grow faster than the country’s GDP to achieve the vision of a developed India.
Anaskar noted that while nationalized banks have penetrated rural areas, cooperative banks remain the first preference for villagers due to their accessibility and personalized services.
NABARD’s latest annual report supports this claim, showing state and district cooperative banks outperforming commercial banks in achieving agricultural credit targets. Together, 34 state cooperative banks, 351 district central cooperative banks, and over 1 lakh primary societies serve around 6.5 lakh villages across the country.
Citing NABARD data, he pointed out that cooperative banks are growing faster than GDP. State cooperative banks’ advances rose by 10.9% to Rs 2.94 lakh crore, while district banks’ credit increased by 11.4% to Rs 4.13 lakh crore in 2024–25.
Profits also remain strong, with 32 of 34 state cooperative banks reporting earnings of Rs 2,691 crore, led by Maharashtra’s record Rs 615 crore.
In contrast, Anaskar expressed concern over the urban cooperative banking sector, which has seen its numbers fall from 2,015 in 2003 to 1,475 today, largely due to RBI restrictions on expansion. Their overall share in banking deposits has also dropped to 2.28% from 6% two decades ago.
Calling for reforms, Anaskar urged cooperative banks to expand digital services, increase lending to agriculture, dairy, food processing, and green energy projects, and focus on sustainable development initiatives.
He stressed that by strengthening credit delivery and embracing technology, cooperative banks could raise their share of GDP beyond 10% and continue to play a vital role in India’s economic progress.