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RBI signals openness on licences for new UCBs

Business Standard

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October 02, 2025

SHIFT IN STANCE

- ABHIJIT LELE

The Reserve Bank of India (RBI) will shortly issue a discussion paper on licensing of new banks in the urban cooperative banking space, signalling a shift in stance on Urban Cooperative Banks (UCBs). Since 2004, issuance of fresh licences for UCBs had been paused following weak financial health of this sector.

In his monetary policy speech, RBI Governor Sanjay Malhotra said the regulator has proposed a public discussion paper in the context of the positive developments in the sector during the last two decades and in response to the growing demand from stakeholders.

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