Home Minister Amit Shah, External Affairs Minister Krishan Pal and Karnataka Minister HK Patil during the International Urban Cooperative Credit Sector Conference (CO-OP KUMBH 2025), in New Delhi, on Monday. | Photo credit: KAMAL KISHORE
Speaking at a two-day international conference on urban cooperative credit sector, Shah highlighted the government’s efforts to professionalize urban cooperative banks (UCBs) and cooperative credit societies, crediting the Reserve Bank of India for enabling their modernization.
He pointed to significant improvements in the health of the sector, with non-performing assets falling from 2.8 percent to 0.6 percent over the past two years.
“There has been good improvement in NPAs. Reforms have been introduced in their operations and financial discipline,” Shah said, urging the National Federation of Urban Cooperative Banks and Credit Societies Limited (NAFCUB) to pursue further expansion.
The minister set an ambitious target for NAFCUB: to set up at least one more UCB in every city with a population of more than two lakh within five years.
He also directed the federation to convert successful cooperative credit societies into UCBs.
“Digi Pay is the need of the hour. We know that payment methods have changed. Digital payment is being used more and more, and if urban cooperative banks do not match, they will drop out of the race,” said Shah, who set a target of bringing 1,500 banks on the platform within two years.
The minister emphasized that GDP growth alone cannot measure national progress.
“GDP should grow but at the same time create livelihood opportunities and uplift the poor, which is what cooperative banks can do,” he said, calling on UCBs to redesign their financing patterns so that they could target young entrepreneurs and economically disadvantaged people.
Since the creation of a separate ministry for cooperation in 2021-22, the Center has introduced several policy reforms to modernize the sector.
Despite collaboration being a state subject, the Center has issued policy guidelines to ensure uniformity.
Model Articles of Association for Primary Agricultural Credit Societies (PACS) were formulated and adopted by all states including West Bengal, allowing PACS to automate and expand services.
Shah congratulated Amul and IFFCO for being ranked among the top two cooperatives in the world by the International Cooperative Alliance, calling it proof that the cooperative movement remains relevant.
NAFCUB Chairman Emeritus and Karnataka Law Minister HK Patil expressed concern over 20 UCBs on the verge of closure, calling for revival efforts similar to those for Yes Bank.
“The current approach is not the right way to close a bank just because they are not viable,” he said.
Minister of State for Cooperation Krishna Pal Gurjar, Minister of State for Cooperation Ashish Kumar Bhutani, NAFCUB President Laxmi Dass and NAFCUB Director Jyotindra M Mehta were present at the event.
Published on November 10, 2025
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