The Reserve Bank of India has imposed restrictions on the banking operations of Puducherry Co-operative Urban Bank Limited allowing depositors to withdraw only up to ₹5,000 from their savings, current, recuring deposit, term deposit and other accounts.
The RBI in its directive said the restrictions were necessary to protect the interests of depositors and for securing proper management of the bank. The bank has been prevented from granting or renewing any loans or advances, making any investments, incurring any liability, including borrowal of funds and acceptance of fresh deposits without prior approval of the RBI, said a government source.
The RBI has directed the bank to prominently display at all its branches and extension counters relevant advisory notice aimed at providing guidance to its customers for redressal of their grievances. Such advisory notice should specifically include the maximum amount of insurance cover provided by Deposit Insurance and Credit Guarantee Corporation for the deposits of customers and the maximum amount permitted to be withdrawn by a depositor as per the directions at a given point of time. Help desks should also be opened for grievance redressal of customers, the directive said.
“The financial position of the bank is not good, though it is not alarming. The RBI has intervened to arrest any further slide in its position. The bank has huge outstanding loans to be recovered. The regulatory body has concerns about its financial position and hence imposed certain cap on its operations to protect the interests of depositors,” the source said.
Published - October 22, 2026 09:00 pm IST