India’s cooperative banking landscape is undergoing a profound upgrade through joint efforts by RBI and the Central Government. Priorities include bolstering balance sheets, refining processes, advancing digital integration, securing savings, facilitating loans, and upholding governance standards.
Pankaj Chaudhary, Minister of State for Finance, informed the Rajya Sabha Tuesday about these initiatives. RBI’s directive, post-Centre consultations, classifies bank loans to NCDC as PSL from January 19, 2026, for specified activities in the 2025 Directions—covering diverse bank types.
Reliefs for urban co-ops: Branch openings liberalized, housing finance limit hiked to 25%. Amended regulations extend board terms to 10 years; AePS fees reduced. NUCFDC emerges as a tech enabler for urban banks.
Rural focus via ‘Sahkar Sarathi’ services and RBI Ombudsman enrollment. These changes address systemic weaknesses, enhancing trust and efficiency.
In conclusion, this collaborative framework positions cooperative banks as vital cogs in India’s inclusive growth engine, promising stability and opportunity for depositors and entrepreneurs.