A resolution was unanimously passed on Saturday in the special general body meeting of Maharashtra Urban Cooperative Banks Federation, to file a writ petition before the appropriate judicial authority
FinTech BizNews Service
Mumbai, 3 January 2026: In the wake of the Banking Regulation Amendment Act, 2025, which came into effect on August 1, 2025, and the procedure for disqualifying directors as stipulated by the Ministry of Finance's gazette notification dated December 10, 2025, an atmosphere of intense concern and confusion has arisen in the urban cooperative banking sector.
Around 400 directors, president, vice prsident level senior bankers of 155 banks attended the SGBM at Pune
Mr Ajay Brahmecha, Chairman, Maharashtra Urban Cooperative Banks Federation, explains: “According to the amendment of August 1, 2025, directors of urban cooperative banks who have completed a tenure of ten years will no longer be able to serve as directors thereafter. There is no logical reason to set a ten-year term limit for serving on the bank's board of directors; in fact, it is unfair. In a democratic country like India, no such term limit has been set for any elected position from the Gram Panchayat level. The amendments made to the Banking Regulation Act in 2020 and 2025, particularly concerning the eligibility and tenure of the board of directors, are very serious issues.”
According to Mr Brahmecha, a resolution was today unanimously passed in the special general meeting of Maharashtra Urban Cooperative Banks Federation, to file a writ petition before the appropriate judicial authority to challenge the ten-year tenure of the board members and the eligibility criteria set for the directors, with the objective of seeking justice on this matter. To ensure that the fundamental values and principles of the cooperative sector remain safe and protected at all times, the Federation should take steps to pursue legal action against these "biased rules and regulations".
Simultaneously, the Maharashtra Urban Co-operative Bank Federation Ltd., an organization representing a large base of cooperative banks in Maharashtra, is immediately planning to initiate discussions with the Ministry of Cooperation on this matter and make the necessary efforts to stop the implementation of these rules and regulations by the central government and the Reserve Bank of India.
The members of the UCBs' board of directors come from diverse fields and possess extensive experience in their respective areas. All directors utilize this experience to ensure the bank remains in good health and earns a good reputation.
On December 10, 2025, a gazette was published, which defined the criteria for eligibility and ineligibility of directors, and instructions were given to implement these criteria from December 15, 2025. Mr Brahmecha, who is also a NAFCUB director, and elected chairman of Lasalgaon Merchants Coop Bank, Nashik, further states: “In this way, the condition of educational qualification is not applicable in the Indian democratic system to any elected person, even to the Members of Parliament. This will have an adverse effect on democratically elected directors and will undermine the democratic principles in the cooperative sector. Furthermore, terminating the terms of members in this manner could lead to the loss of experienced members from the board of directors, potentially resulting in a lack of mature and experienced guidance that would otherwise benefit the institution. Moreover, while the 97th Constitutional Amendment granted certain fundamental rights and autonomy to cooperative societies, the implementation of such arbitrary and unjust restrictions significantly weakens these rights.”
