In a significant step towards harmonizing the regulatory framework for Urban Cooperative Banks (UCBs), the National Federation of Urban Cooperative Banks and Credit Societies Ltd. (NAFCUB) has constituted a high-level committee to draft Model Bye-laws for UCBs across India.
The move comes in the wake of discussions held during the 38th Standing Advisory Committee (SAC) meeting of the Reserve Bank of India (RBI) on January 23, 2025, in Mumbai.
Chaired by M. Rajeshwar Rao, Deputy Governor of RBI, the SAC meeting emphasized the urgent need for uniformity in UCB bye-laws in light of amendments to the Banking Regulation (BR) Act, 1949 in 2020 and the Multi-State Cooperative Societies (MSCS) Act, 2002 in 2023. These amendments have introduced several regulatory expectations, requiring timely and consistent compliance from cooperative banks.
Recognizing this, NAFCUB has announced the formation of a four-member committee, which will be led by Uday Joshi, Director, NAFCUB. The committee has been given a three-month timeline to draft a comprehensive set of model bye-laws that can serve as a guiding framework for UCBs nationwide.
The other members include O.P. Sharma, also a Director at NAFCUB, a representative from the Office of the Central Registrar of Cooperative Societies (CRCS), and R.D. Trivedi, Joint Registrar from the Government of Gujarat.
Reacting to the development Joshi expressed deep appreciation for the confidence reposed in him and stated, “I am honored to chair this important committee at a time when cooperative banking is undergoing pivotal regulatory changes”.
“This initiative will bring much-needed alignment and clarity to the governance structures of Urban Cooperative Banks. Our goal is to ensure that the model bye-laws are not only compliant but also forward-looking, helping UCBs grow with stability and transparency”, he added.
We will work diligently with all stakeholders to deliver within the stipulated timeline.”
InspiteInspite of B R Amendment 2020 & end of dual regulations frauds in co – operative banks are continued. Formation of task force have not given result.
We co- operative banks will regain trust of depositors?
This is a great initiative,as UCBS can have uniform structure. Model bye laws can lead bank towards stable growth in future,also for government authorities this is will act as measurement for verification of policies, rules ®ulations. I hope that this bye laws, will also consider the needs& requirements of the bank for compliance,such as proper platform of softwares to make sure that the banks can enjoy cost reduction and a small unit can also provide best possible services to the prospective customers.
D B Jadhav
CEO
The Khamgaon Urban Co-op Bank Ltd.
This is great endeavour taken by federation. I believe that this model bye-law will bring good and fruitful changes which can fulfill expectations of bankers as well as customers. These proposed changes will bring comprehensive changes and avoid ambiguity.
I wish all the very best for this new attempt to federation.
CEO
The Panvel Co-operative urban Bank Ltd.
Common buy- laws and corresponding guidelines tier wise shall help the big and small entities grow on equal footing.Healthy competition may help but unwarranted may be avoided.The expenses need to be curtailed and earnings to grow may find place. All the best
.incidentally nafcub may strive to put pressure on govt to frame law to bring ucbs to function under one regulatory authority and central govt.