Document title: Directions under Section 35A read with Section 56 of the Banking Regulation Act, 1949 – Desaiganj Nagari Cooperative Bank Maryadit, Desaiganj
Issuing authority: Reserve Bank of India
Reference: Directive Ref. No. NGP.DOS.SSM 3.No.S276/15-02-156/2026-2027
Date: 27 August 2026
Banking and Credit
The RBI has directed that, effective at the close of business on 27 August 2026, Desaiganj Nagari Cooperative Bank Maryadit shall not, without prior written approval of the RBI, grant or renew any loans and advances, make any investment, incur any liability including borrowing of funds, accept fresh deposits, disburse or agree to disburse any payment, enter into any compromise or arrangement, or sell, transfer or otherwise dispose of any of its properties or assets, except as specifically notified in the RBI Direction dated 25 August 2026. The bank is also prohibited from allowing withdrawals from savings, current or any other depositor accounts, although it may set‑off loans against deposits subject to the conditions stated in the Directions. Expenditure on essential items such as employee salaries, rent and electricity may be incurred as specified in the Directions.
Financial Stability and Inclusion
Depositors eligible under the Deposit Insurance and Credit Guarantee Corporation (DICGC) Act, 1961, are entitled to claim insurance coverage up to ₹5,00,000 per depositor. Claims are to be made after submission of willingness and verification by DICGC. Depositors may obtain further information from bank officials or the DICGC website (www.dicgc.org.in).
Regulatory and Policy Measures
The RBI has previously engaged with the bank’s Board and senior management to improve its functioning, but observed insufficient corrective action, prompting the issuance of these Directions. The notice clarifies that the directive does not constitute cancellation of the bank’s licence; the bank will continue to undertake banking business subject to the imposed restrictions until its financial position improves. The RBI will continue to monitor the bank and may modify the Directions as warranted. The Directions will remain in force for six months from the close of business on 27 August 2026 and are subject to review.
The directive reflects RBI’s intent to protect depositor interests, preserve financial stability, and enforce corrective action in a cooperative bank facing liquidity stress.