Customers of this bank will not be able to withdraw the money deposited in their own account, RBI canceled the license – know the whole matter

Indian The Reserve Bank (RBI) has canceled the license of Shirpur Merchants Co-operative Bank. Shirpur Merchants Co-operative Bank does not have sufficient capital and profit potential for business, due to which RBI has taken this action. As a result of the license cancellation, Shirpur Merchants Co-operative Bank will cease to operate with effect from April 6, 2026, the RBI said in a statement on Monday. The Cooperative Commissioner, Registrar of Cooperative Societies has been requested to issue an order to close the bank and appoint a liquidator.

What will happen to the customers’ money deposited in the bank now?

On liquidation, every customer depositing money in each bank will be entitled to receive deposit insurance on his deposits from the Deposit Insurance and Credit Guarantee Corporation (DICGC) up to a maximum of Rs 5,00,000. The Reserve Bank of India said that as per co-operative bank data, about 99.7 per cent of depositors are entitled to receive the full amount of their deposits from the Deposit Insurance and Credit Guarantee Corporation. DICGC has already paid Rs 48.95 crore of the total insured deposits, based on the consent of the depositors concerned, till January 31, 2026.

What is the full reason for canceling the bank’s license?

Giving detailed information regarding the cancellation of the license, RBI said that Shirpur Merchants Co-operative Bank does not have adequate capital and profit prospects and due to its current financial condition it will be unable to make full payments to its existing customers. “Continuing operations of the bank would be detrimental to the interests of its customers,” the central bank said. As a result of the license cancellation, Shirpur Merchants Co-operative Bank has been barred from carrying on banking business, including accepting deposits and disbursing deposits, with immediate effect.