The Valsad Mahila Nagrik Sahakari Bank Ltd

RBI has extended its existing Section 35A directions on Valsad Mahila Nagrik Sahakari Bank Ltd. for another three months.

The bank must continue operating under the same RBI-imposed restrictions until close of business on 18 December 2026, unless further modified or withdrawn. Customers and counterparties remain subject to the operational constraints already in place under the directive.

• Section 35A read with Section 56 of the Banking Regulation Act, 1949
• sub-section (1) of Section 35A read with Section 56 of the Banking Regulation Act, 1949

RBI has extended its existing Directions under Section 35A read with Section 56 for The Valsad Mahila Nagrik Sahakari Bank Ltd. by three months.

The bank continues to operate under the same RBI-imposed restrictions until close of business on September 18, 2026, subject to review. There is no new monetary penalty, but the existing operational constraints remain in force for the bank and its stakeholders.

• Section 35A read with Section 56 of the Banking Regulation Act, 1949
• sub-section (1) of Section 35A read with Section 56 of the Banking Regulation Act, 1949

RBI placed The Valsad Mahila Nagrik Sahakari Bank Ltd. under Section 35A/Section 56 directions effective December 18, 2025. The bank faces limits on lending, deposits, payments, and withdrawals for six months, subject to review.

The bank must operate under tight RBI-imposed restrictions until the directions are modified or expire. Depositors cannot freely withdraw funds, while the bank may only undertake permitted essential expenditures and limited set-off transactions; lending, fresh deposits, investments, and most liability-creating activities are frozen without prior RBI approval.

• Section 35 A read with Section 56 of the Banking Regulation Act, 1949
• DICGC Act, 1961

RBI imposed a monetary penalty of ₹1.25 lakh on The Valsad Mahila Nagarik Sahakari Bank Ltd., Valsad, Gujarat. The penalty was for multiple regulatory compliance lapses spanning asset classification, CIC reporting, KYC updation, and dormant account handling.

The bank must absorb the ₹1.25 lakh penalty, and the order serves as a supervisory finding of non-compliance. No immediate operating restriction is described, but the bank remains exposed to any further RBI action and must ensure future compliance with NPA classification, CIC reporting, KYC updation, and dormant account rules.

• section 47A (1) (c) read with sections 46 (4) (i) and 56 of the Banking Regulation Act, 1949
• section 25 of the Credit Information Companies (Regulation) Act, 2005