Banking Regulation (Amendment) Act, 2020
Post-PMC Bank Reforms
The Punjab and Maharashtra Co-operative (PMC) Bank crisis of September 2019, involving large-scale exposure concealment to a single builder group, triggered the Banking Regulation (Amendment) Act, 2020, which substantially expanded RBI's direct regulatory powers over cooperative banks.
- The Act brought about 1,482 Urban Cooperative Banks and 58 Multi-State Cooperative Banks under enhanced RBI supervision, effective from 26 June 2020
- RBI was empowered to regulate cooperative banks in a manner similar to scheduled commercial banks, including powers over management, audit, capital raising, and amalgamation/reconstruction schemes
- RBI can now frame amalgamation schemes for a distressed cooperative bank without first placing it under a moratorium — a power aimed at avoiding depositor panic and prolonged account freezes
- PMC Bank was eventually merged into Unity Small Finance Bank
● Tracked since July 27, 2026 · last seen August 07, 2026 · updates as the daily brief publishes
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