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Informist, Monday, Jul. 28, 2025

--RBI issues draft master directions for business authorisation of co-op bks 

MUMBAI – The Reserve Bank of India on Monday released a draft of master directions on business authorisation for all co-operative banks. "Based on a comprehensive review, it has been decided to replace the Financially Sound and Well Managed (FSWM) norms for UCBs (urban co-operative banks) with harmonised eligibility criteria for all banks for certain business authorisations/permissions/approvals," the RBI said. 

In order to fully comply with the new norms, a bank should have the regulatory minimum applicable capital, net non-performing assets of not more than 3%, net profits during the preceding two financial years, without any accumulated losses in the balance sheet, no default in the maintenance of cash reserve ratio and statutory liquiduity ratio during the preceding and current financial year, Core Banking Solution (CBS) fully implemented. The bank also should not have been under any supervisory action, in the previous or current financial year, the RBI said.  

The directions also include norms for expanding the branch base of the banks. The comments on the draft directions are invited from public and stakeholders till Aug. 25, the RBI said.  End

Reported by Kabir Sharma

Edited by Vandana Hingorani

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