Document title: Directions under Section 35 A read with Section 56 of the Banking Regulation Act, 1949 – Puducherry Co‑operative Urban Bank Ltd

Issuing authority: Reserve Bank of India (RBI)

Reference number: Directive Ref. No. CHN.DoS.UCBs.No.S336/16-05-847/2026-2027

Date: October 21, 2026

Banking and Credit

The RBI has directed that, as of the close of business on October 21, 2026, Puducherry Co‑operative Urban Bank Ltd 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 and acceptance of 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 October 19, 2026.

Financial Stability and Inclusion

The bank is permitted to allow withdrawals of an amount not exceeding ₹5,000 (Rupees Five Thousand only) from savings, current or any other depositor accounts. It may also set off loans against deposits subject to the conditions stated in the RBI Directions. The bank may incur expenditure for essential items such as employee salaries, rent, electricity bills, and similar necessities as specified in the Directions. Depositors are entitled to claim insurance coverage for their deposits up to a ceiling of ₹5,00,000 (Rupees Five Lakh only) from the Deposit Insurance and Credit Guarantee Corporation (DICGC) under the DICGC Act, 1961, upon submission of willingness and verification. Information on the insurance claim process is available on the DICGC website.

Regulatory and Policy Measures

The RBI has previously engaged with the bank’s Board and Senior Management to improve its functioning, but the lack of concrete remedial actions prompted the issuance of these restrictive Directions. The RBI clarified that the issuance of the Directions does not constitute a cancellation of the banking licence; the bank will continue to undertake banking business subject to the imposed restrictions until its financial position improves. The Directions will remain in force for a period of six months from the close of business on October 21, 2026, and are subject to review and possible modification based on the bank’s circumstances and the interests of depositors.

The directive is signed by Brij Raj, Chief General Manager, and released as Press Release 2026-2027/1362.