Urban cooperative banks (UCBs) must prioritise governance, risk management and secure technology adoption while maintaining depositor trust, Reserve Bank of India (RBI) deputy governor Swaminathan J said on Friday.
He was speaking at a seminar for UCB directors, where he highlighted the evolving role of UCBs in the country’s financial landscape and the imperative of responsible governance to ensure their continued relevance and resilience.
Recognising 2025 as the UN-designated International Year of Cooperatives, he contextualised the cooperative model’s historical contribution to inclusive development and emphasised how UCBs uniquely embody grassroots financial engagement.
Balancing dual identity
The address underscored the dual identity of UCBs as community-rooted cooperatives and regulated banking institutions, with a call to uphold depositor trust through sound governance, risk management, and accountability.
The deputy governor outlined five key governance imperatives for UCBs: robust board oversight with independent judgment and transparency, assurance functions with autonomy and board engagement, constructive collaboration with auditors and RBI inspectors, strategic tech adoption aligned with cybersecurity and operational capacity, and leveraging the National Urban Cooperative Finance and Development Corporation (NUCFDC) for scale, technology, and capital support.
Call for visionary leadership
Swaminathan affirmed the critical role of UCBs in India’s financial ecosystem and called upon their leadership to embody sharper governance and strategic foresight. He also assured the RBI’s commitment to the sector, not just as a regulator, but as an enabling partner.