RBI Proposes Resuming Urban Cooperative Bank Licenses with New Eligibility Criteria

The Reserve Bank of India (RBI) has proposed resuming licensing for urban cooperative banks (UCBs) after a pause of over two decades, introducing new eligibility criteria including a minimum capital requirement of ₹300 crore, a capital adequacy ratio above 12%, and net non-performing assets below 3%. The RBI aims to license only large, well-managed cooperative credit societies with a longer operational track record to strengthen governance and financial stability in the sector. Stakeholders have been invited to comment on the discussion paper by February 2026.