Macro● Neutral
Shah Tells Cooperative Banks to See RBI as Ally After Policy Moves
Amit Shah says RBI has 'proactively helped' urban cooperative banks with policy relaxations, and urged them to see the regulator as an ally. He also announced NUCFDC's move to Maharashtra.
Continue with
Union Minister Amit Shah urged urban cooperative banks on Saturday to look at the Reserve Bank of India from a different viewpoint, saying the central bank has proactively helped the sector in recent years. Speaking at the inauguration of the National Urban Cooperative Finance and Development Corporation's new office at the BSE, Shah told an audience of executives from over 1,400 UCBs that the old mutual suspicion should give way to a more trusting relationship.
“My five years’ experience as the Union Cooperatives Minister suggests that whenever we have put a step forward with confidence, RBI has proactively helped us,” Shah said. He listed a series of regulatory relaxations delivered by the central bank: liberalised branch opening, permission to offer doorstep banking, the ability to issue demand drafts and life certificates, and the appointment of a dedicated nodal officer for UCB affairs. The RBI also raised limits on gold loans and allowed one-time settlements for urban cooperative lenders, he added.
The sector holds over ₹6 lakh crore in deposits, Shah noted. On Wednesday, RBI Governor Sanjay Malhotra announced progress on on-tap licensing for UCBs, ending a two-decade pause on new licenses. The move signals a shift in regulatory posture toward the sector, which has historically been viewed with caution after governance failures at some politically connected lenders.