Skip to main content

Opening / shifting / closure of place of business by DCCBs

Reserve Bank of India (RBI) has issued guidelines for opening / shifting / closure of place of business by District Central Co-operative Banks (DCCBs).

What is the pre-condition for opening / shifting place of business by DCCBs?

Pursuant to the amendment to the Banking Regulation Act dated September 29, 2020, District Central Co-operative Banks (DCCBs) are permitted to open new place of business / install ATMs or shift the location of such offices only after obtaining prior approval of Reserve Bank of India (RBI). 

What is the criteria for opening / shifting / upgrading the place of business by DCCBs?

The criteria for opening of branches / extension counters / specialized branches / regional offices / zonal offices / administrative offices / shifting of branches / upgradation of extension counters into full-fledged branches by a DCCB are as follows -

  • A licensed DCCB should have completed at least 3 years of operation.
  • CRAR at least 9%.
  • No default in maintenance of CRR / SLR during the preceding financial year.
  • Net NPA less than 5%.
  • The bank should have made a net profit during the preceding 2 financial years.
  • The bank should have a good track record of regulatory compliance and no monetary penalty should have been imposed on the bank for violation of RBI directives / guidelines during last 2 financial years.
  • The bank should not have been placed under any specific direction issued by RBI during the preceding 2 financial years.

What is the process for opening / shifting / upgrading the place of business by DCCBs?

  • DCCBs may submit their application to concerned Regional Office (RO) of RBI for prior approval for opening of branches / extension counters / specialized branches / regional offices / zonal offices / administrative offices / shifting of branches / upgradation of extension counters into full-fledged branches. 
  • The banks shall also forward a copy of the application to National Bank for Agriculture and Development (NABARD) which, in turn, shall forward their recommendation in the matter to concerned RO of RBI.

What is the criteria for installation of ATMs by DCCBs?

  • DCCBs shall be allowed to install on-site ATMs without seeking prior approval of RBI. 
  • They may also install off-site / mobile ATMs without prior permission from RBI subject to satisfying the criteria for opening / shifting / upgrading the place of business as mentioned above. 
  • DCCBs shall report to concerned RO of RBI under whose jurisdiction the Head Office of the DCCB is functioning, immediately after operationalization of the off-site / mobile ATMs but within 15 days, and obtain authorization under Section 23 of the Banking Regulation Act, 1949 (AACS) from the concerned RO of RBI.

What is the criteria for shifting place of business by DCCBs?

DCCBs may shift their branches / offices / extension counters located in the rural or semi-urban or urban / metropolitan areas, within the same village or town or locality / municipal ward respectively, without prior permission of RBI.

The DCCBs shall ensure that -

  • The decision to shift branch shall be taken by the Board.
  • The shifting of branch shall be approved by Registrar of Cooperative Societies (RCS), as required under Co-operative Act / Rules applicable.
  • Customers of the branch, which is being shifted, should be informed 2 months in advance so as to avoid inconvenience to them.
  • A report shall be submitted by DCCBs to the concerned RO of RBI and NABARD within 1 month from the date of such shifting.
  • The DCCBs shall submit the branch licence in original to the concerned RO of RBI for recording the change in the branch licence.

What is the criteria for closure of branches and extension counters by DCCBs?

DCCBs are allowed to close their un-remunerative branches without prior permission of RBI subject to the following conditions -

  • The bank should not have been placed under any directions under section 35A of the Banking Regulation Act, 1949 (AACS).
  • The decision to close down branches should be taken by the Board.
  • The closure of branch shall be approved by RCS of the respective state.
  • The bank should give 2 months notice in advance to all existing depositors / clients of the branch through press release in local leading newspapers as well as communicate to each constituent of the branch, well in advance of closure of the branch.
  • It should return the original licences issued for the closed branch to the concerned RO of RBI.
  • The disposal of the premises occupied by the erstwhile branch should be reported to the concerned RO of RBI, NABARD and RCS.
  • Bank should report to the concerned RO of RBI and NABARD after closing the branches, within 1 month from the date of closure, along with copies of the relative Board resolution and RCS approval.
  • The bank should preserve all the relevant records and make them available to NABARD inspection team for scrutiny during the course of inspection.


References

Reserve Bank of India. (2022, August 11). 'Section 23 of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies) – Opening of new place of business by District Central Co-operative Banks (DCCBs)'. Retrieved from https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12375&Mode=0

Reserve Bank of India. (2023, October 30). 'Clarification regarding Shifting of Branches/Offices/Extension Counters within the same city, town or village by District Central Co-operative Banks (DCCBs) and Guidelines on Closure of Branches and Extension Counters by DCCBs'. Retrieved from https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12559&Mode=0


Follow at - Telegram   Instagram   LinkedIn   Twitter   Facebook

Labels:

Comments

Post a Comment

Popular Posts

Trade Receivables Discounting System (TReDS)

Reserve Bank of India (RBI) has issued the directions on Trade Receivables Discounting System (TReDS). What is TReDS? TReDS is a technology platform on a digital or electronic network for facilitating factoring of trade receivables through multiple financiers. What is a Factoring Unit? Factoring unit refers to trade receivable in the form of invoice / bill uploaded either by the seller (in the case of factoring) or by the buyer (in case of reverse factoring), as the case may be. Who are the participants in TReDS? Seller – Micro, Small and Medium Enterprise (MSME) Buyer – any person liable to the seller, whether under a contract or otherwise, against an invoice or bill of exchange, to pay any trade receivable Financier – all entities / institutions permitted to undertake factoring business under the Factoring Regulation Act, 2011 Insurance companies  Credit Guarantee Fund Trust notified by the Government of India Who can operate TReDS platforms? An entity shall seek authorisation fr...
Post a Comment
Read more

Transfer of Surplus by the RBI to the Government

The surplus payable by the Reserve Bank of India (RBI) to the Central Government for the financial year 2025-26 amounted to ₹2,86,588.46 crore.  Why does the RBI transfer the surplus amount to the Central Government? As per section 47 of the RBI Act, 1934, after making provision for bad and doubtful debts, depreciation in assets, contributions to staff and superannuation funds and other provisions, the balance of the profits of the RBI is required to be paid to the Central Government. Also, the Central Government holds 100% of the share capital of the RBI. How much risk provision is required to be maintained by the RBI? The RBI developed the Economic Capital Framework (ECF) during 2014-15 and 2015-16 for determining the appropriate level of risk provisions to be made under the provisions of section 47 of the RBI Act, 1934.  In November 2018, the RBI, in consultation with the Government, constituted an Expert Committee to review the ECF of the RBI (Chairman: Dr. Bimal Jalan, fo...
Post a Comment
Read more

Swap Facility for FCNR (B) Deposits, ECBs and OFCBs (updated as on June 23, 2026)

Reserve Bank of India (RBI) has introduced US Dollar-Rupee swap facility for Foreign Currency Non-Resident (Bank) [FCNR (B)] deposits, External Commercial Borrowings (ECBs) and Overseas Foreign Currency Borrowings (OFCBs). Swap facility for FCNR (B) deposits Swap facility for ECBs and OFCBs The swap facility has been introduced for fresh FCNR (B) deposits, including deposits that are renewed upon maturity, for a minimum tenor of 3 years and a maximum tenor of 5 years. The swap facility has been introduced for – ECBs of average maturity of 3 years and above, drawn on after June 8, 2026 till December 31, 2026 by – (a) Public Sector Undertakings (PSUs) whose majority ownership is held by the central and / or state government (other than banks), or (b) PSUs which are incorporated, established or registered under a Central or State Act and controlled by the central / state government. The facility will also be available for the undrawn portion of any exist...
Post a Comment
Read more

Payment of Agency Commission to Agency Banks (ABs) and Disbursement of Government Pension by ABs

Reserve Bank of India (RBI) has issued guidelines on the conduct of Government business by Agency Banks (ABs), payment of agency commission to ABs and disbursement of Government pension by ABs. Who are ABs? ABs mean all Public Sector Banks (PSBs), scheduled Private Sector Banks (PVBs), scheduled Payments Banks (PBs), and scheduled Small Finance Banks (SFBs) appointed by the RBI under Section 45 of the RBI Act, 1934, by mutual agreement, to carry out Government banking business of the Central Government (CG) / State Governments (SGs). What is agency commission? Agency commission means the remuneration paid by the RBI to an AB in consideration of it acting as an agent of the RBI in the conduct of general banking business of the CG and the SGs at the places and in the manner specified in the agreement between the RBI and the bank, with the exception of the functions relating to the management of the public debt. What are the guidelines on appointment of ABs? Any eligible bank which intend...
Post a Comment
Read more

Highlights of RBI Annual Report 2025-26 – Chapter 7 to 12

Reserve Bank of India (RBI) has published its annual report for the financial year 2025-26. In a series of articles, we will go through the highlights of the report. This is the fifth and final article in the series.  Chapter 7 – Public Debt Management The ways and means advances (WMA) limit for the Government of India (GoI) for H1:2025-26 (April to September 2025) was fixed at ₹1,50,000 crore and for H2:2025-26 (October 2025 to March 2026) was fixed at ₹50,000 crore. The RBI entered into an agreement with the Government of National Capital Territory of Delhi (GNCTD), under Section 21A(1) of the RBI Act, 1934, to carry on the general banking business of GNCTD and manage its rupee public debt. The WMA limit of GNCTD was set at ₹890 crore, taking the aggregate WMA limit of all the states / UTs to ₹61,008 crore. The RBI introduced Separate Trading of Registered Interest and Principal of Securities (STRIPS) in the state government securities. Retail Direct Gilt (RDG) account – An au...
Post a Comment
Read more