**Executive Summary**
The Reserve Bank of India (RBI) issued Directions under Section 35 A read with Section 56 of the Banking Regulation Act, 1949, to Sadbhav Nagrik Sahakari Bank Maryadit, Chhatarpur, effective October 07, 2025. These Directions place restrictions on the bank's operations due to supervisory concerns and aim to protect the interests of depositors. The Directions are valid for six months from October 07, 2025, and are subject to review.
**Key Points / Main Content**
* **Restrictions on Bank Operations:**
* The bank is prohibited from granting or renewing loans and advances without prior RBI approval.
* The bank cannot make investments, incur liabilities (including accepting fresh deposits), or disburse payments without RBI approval.
* The bank is restricted from entering into compromises or arrangements, or selling/transferring assets without RBI approval.
* **Withdrawal Limit:**
* Depositors are permitted to withdraw a maximum of ₹5,000 from their savings, current, or other accounts.
* The bank is allowed to set off loans against deposits, subject to RBI conditions.
* The bank can incur expenditure for essential items like salaries, rent, and electricity bills, as specified by the RBI.
* **Deposit Insurance:**
* Eligible depositors are entitled to receive deposit insurance up to ₹5,00,000 from the Deposit Insurance and Credit Guarantee Corporation (DICGC).
* Claims are subject to submission of willingness by depositors and verification.
* Depositors can contact bank officials for information, or access the DICGC website (www.dicgc.org.in).
* **Continuity of Banking Business:**
* The issuance of Directions does not imply cancellation of the bank's license.
* The bank will continue banking business subject to the imposed restrictions until its financial position improves.
* The RBI will continue to monitor the bank and may modify the Directions as necessary.
**Impact Analysis**
**Stakeholder: Sadbhav Nagrik Sahakari Bank Maryadit**
* **Impact:** Restricted operational capabilities due to imposed limitations on lending, investment, and disbursement activities. Heightened regulatory scrutiny and the need for RBI approval for key financial decisions.
* **Action Required:** Adhere strictly to the Directions issued by the RBI, address supervisory concerns, and work towards improving its financial position to have the restrictions lifted.
**Stakeholder: Depositors**
* **Impact:** Limited access to their funds due to the withdrawal cap. Potential reliance on deposit insurance for amounts exceeding the withdrawal limit.
* **Action Required:** Contact the bank or DICGC for information regarding their deposit insurance claims, and cooperate with the bank in providing necessary documentation.
**Stakeholder: Reserve Bank of India (RBI)**
* **Impact:** Increased oversight and monitoring responsibilities to ensure the bank's compliance with the Directions and to safeguard depositor interests. Potential need to take further actions if the bank's financial situation does not improve.
* **Action Required:** Continue monitoring the bank's performance, assess the effectiveness of the Directions, and make necessary adjustments or take additional measures as warranted.
Key Entities Referenced
Reserve Bank of India (RBI): The regulator issuing directions to the specified bank
Banking Regulation Act, 1949: The primary law under which the directions are issued. Specifically, Section 35 A read with Section 56 of the Act.
Sadbhav Nagrik Sahakari Bank Maryadit, Chhatarpur: The bank to which the directions are issued, located in Chhatarpur.
Deposit Insurance and Credit Guarantee Corporation (DICGC): Responsible for deposit insurance up to a monetary ceiling of ₹5,00,000/- for eligible depositors of the concerned bank.
प्रेस प्रकाशनी PRESS RELEASE
भारतीय ररज़र्व बैंक
RESERVE BANK OF INDIA
वेबसाइट
:
www.rbi.org.in/hindi
संचार वर्भाग, केंद्रीय कायाालय, शहीद भगत ससिंह मागा, फोटा, म िंबई - 400 001
Website : www.rbi.org.in Department of Communication, Central Office, Shahid Bhagat Singh Marg, Fort,
ई-मेल/email : helpdoc@rbi.org.in Mumbai - 400 001 फोन/Phone: 022 - 2266 0502
October 07, 2025
Directions under Section 35 A read with Section 56 of the Banking Regulation
Act, 1949 – Sadbhav Nagrik Sahakari Bank Maryadit, Chhatarpur
It is hereby notified for information of the public that in exercise of powers vested
in it under sub section (1) of Section 35 A read with Section 56 of the Banking
Regulation Act, 1949, the Reserve Bank of India (RBI) vide Directive Ref. No.
BPL.DOS.SED.No.S1638/12-07-054/2025-2026 dated October 06, 2025, has issued
certain Directions to Sadbhav Nagrik Sahakari Bank Maryadit, Chhatarpur,
whereby, as from the close of business on October 07, 2025, the bank shall not,
without prior approval of RBI in writing, grant or renew any loans and advances, make
any investment, incur any liability including borrowal of funds and acceptance of fresh
deposits, disburse or agree to disburse any payment whether in discharge of its
liabilities and obligations or otherwise, enter into any compromise or arrangement and
sell, transfer or otherwise dispose of any of its properties or assets except as notified
in the RBI Direction dated October 06, 2025, a copy of which has been directed to be
displayed on the bank's website / premises for perusal by interested members of the
public. Considering the bank's current liquidity position, the bank has been directed to
permit withdrawal of a sum not exceeding ₹5,000/- (Rupees Five Thousand only)
of the total balance held in savings bank or current accounts or any other account of
a depositor but is allowed to set off loans against deposits subject to the conditions
stated in the above RBI Directions. The bank may incur expenditure in respect of
certain essential items such as salaries of employees, rent, electricity bills, etc., as
specified in the said Directions.
2. RBI has in the recent past engaged with the Board and Senior Management of the
bank for improvement in its functioning. However, lack of concrete efforts taken by the
bank to address the supervisory concerns and to protect the interest of depositors of
the bank, necessitated issuance of these Directions.
3. The eligible depositors would be entitled to receive deposit insurance claim amount
of their deposits up to a monetary ceiling of ₹5,00,000/- (Rupees Five Lakh only) in
the same capacity and in the same right, from the Deposit Insurance and Credit
Guarantee Corporation (DICGC), as applicable under the provisions of the DICGC
Act, 1961, based on submission of willingness by the depositors concerned and after
due verification. The depositors may contact the bank officials for further information.
Details may also be accessed on the DICGC website: www.dicgc.org.in.
4. The issue of the above Directions by the RBI should not per se be construed as
cancellation of the banking license by RBI. The bank will continue to undertake
banking business subject to restrictions specified in the said Directions till its financialposition improves. The RBI continues to monitor the position of the bank and will take
necessary actions including modifications of these Directions, as warranted,
depending upon circumstances and in the interest of the depositors.
5. These Directions shall remain in force for a period of six months from the close of
business on October 07, 2025 and are subject to review.
(Brij Raj)
Press Release: 2025-2026/1268 Chief General Manager