In a decisive effort to broaden the reach of rural cooperative banking across India, NABARD has unveiled an approach paper recommending the creation of 240 new District Central Cooperative Banks (DCCBs) and two State Cooperative Banks (StCBs) situated in underserved territories.
The Ministry of Cooperation has sent the proposal to state governments for feedback and action, signaling a sustained momentum toward expanding financial inclusion.
The approach paper lays out a plan to establish 240 additional DCCBs, contingent upon viable implementation plans. This initiative aims to bridge gaps in the existing Short-Term Cooperative Credit Structure (STCCS), which currently comprises 351 DCCBs operating across 573 of the country’s 615 districts, leaving 42 districts without such institutions.
Among these, 38 districts have State Cooperative Bank branches but lack dedicated DCCBs, while four districts, three in Jharkhand and one in Uttar Pradesh, are completely bereft of both StCB branches and DCCBs.
Crucially, the paper highlights the absence of cooperative banking infrastructure in two Union Territories, Ladakh and Lakshadweep. To address this, it proposes establishing StCBs in each of these regions, thereby enabling access to tailored cooperative banking services through a two-tier system.
Beyond new bank proposals, the document consolidates relevant statutory and regulatory guidelines governing the formation of both State Cooperative Banks and DCCBs. This structured roadmap is designed to assist state governments in aligning with regulatory expectations while expanding the cooperative credit structure efficiently.
Already, tangible progress is visible: the Reserve Bank of India has approved the bifurcation of the Salem DCCB in Tamil Nadu, paving the way for the creation of a separate DCCB serving Namakkal district. This step exemplifies the targeted, region-specific restructuring envisioned in the broader proposal.
These developments come against a backdrop of an evolving cooperative banking landscape. As of mid-August 2025, India has 34 State Cooperative Banks and 351 District Central Cooperative Banks under NABARD and RBI supervision.
The plan for 240 new DCCBs thus represents a transformative expansion, potentially increasing the DCCB network by nearly 70%.
The rationale for this expansion is deeply rooted in addressing financial deserts across rural India. Cooperative banks traditionally play a vital role at the grassroots level, facilitating credit flows for agriculture and allied activities. Yet disparities in geographic coverage have persisted, hindering equitable access.
By ensuring that every district has a focused DCCB and that currently neglected regions gain institutional presence, the initiative aims to weave cooperative banking more tightly into India’s rural financial ecosystem.
As the Ministry of Cooperation seeks inputs from state governments, implementation of this vision could significantly reinforce the cooperative movement. Bolstering regional banking infrastructure through new DCCBs and strategic establishment of State Cooperative Banks in Ladakh and Lakshadweep could lay the foundation for greater rural financial resilience and inclusion.
