RBI Boosts Cooperative Banks: New Measures for Depositors, Borrowers, and Digital Reach

• RBI, in consultation with the central government, introduces measures to improve financial health, governance, and digital reach of cooperative banks.
• Loans sanctioned by banks to NCDC for on-lending to cooperative societies will be treated as 'priority sector lending' (PSL) from January 19, 2026.
• Urban Cooperative Banks (UCBs) can now open new branches, and their housing loan exposure limit is raised from 10% to 25% of total loans.
• Maximum tenure for cooperative bank directors increased from 8 to 10 years; Aadhaar-enabled Payment System (AePS) licensing fees reduced.
• NUCFDC and 'Sahakar Sarthi' established to provide IT infrastructure and technological support to Urban and Rural Cooperative Banks, respectively.