RBI Update: The Reserve Bank of India (RBI) has imposed several strict restrictions on The Baghat Urban Co-operative Bank, located in Solan, Himachal Pradesh. Under the new rules, customers can now withdraw only up to ₹10,000 from their accounts.
The RBI said it took this decision after noticing serious concerns about the bank’s operations in recent months.
Despite discussions with the bank’s board and senior management, no effective steps were taken to improve the situation. The move aims to protect the interests of depositors.
New Restrictions Imposed
According to the RBI’s directive, the bank cannot issue new loans or advances, accept new deposits, or raise fresh borrowings without prior approval from the central bank. However, it is allowed to adjust deposits against existing loans of customers.
The RBI noted that the bank’s cash position is currently weak, which is why a withdrawal limit has been introduced.
What Customers Should Know
The RBI clarified that these restrictions do not mean the bank’s license has been cancelled. The Baghat Urban Co-operative Bank will continue limited operations until its financial health improves.
Eligible depositors are also covered under the Deposit Insurance and Credit Guarantee Corporation (DICGC) scheme and can claim up to ₹5 lakh as insurance on their deposits if needed.
Duration of Restrictions
These restrictions will remain in effect for six months, starting from October 8, 2025.
The RBI said it will continue monitoring the bank’s financial condition and may modify or lift the restrictions depending on future developments.
