Case Brief
What Happened
RBI issued fresh directions under Section 35A read with Section 56 of the Banking Regulation Act, 1949 against Sadbhav Nagrik Sahakari Bank Maryadit, Chhatarpur. Citing supervisory concerns and the bank's lack of concrete efforts to improve its functioning and safeguard depositors, RBI restricted it from granting or renewing loans, making investments, incurring liabilities, accepting fresh deposits, disbursing payments, entering into compromises or arrangements, and selling or transferring assets without prior approval. Depositor withdrawals are capped at ₹5,000 per account, subject to the stated conditions, and the bank may incur only specified essential expenses. RBI clarified that this is not a cancellation of the banking licence and that the bank will continue to undertake banking business subject to the restrictions, which remain in force for six months from October 07, 2025.