Gokak-based Shree Mahalaxmi Urban Cooperative Credit Bank's Licence Cancelled by RBI
Moneylife Digital Team 18 June 2026
Reserve Bank of India (RBI) has cancelled the certificate of registration (CoR) of Gokak, Karnataka-based Shree Mahalaxmi Urban Cooperative Credit Bank Ltd due to inadequate capital and poor earnings prospects. RBI has directed Shree Mahalaxmi Urban Cooperative Credit Bank to cease banking operations from 18 June 2026.
 
According to RBI, the Bank has failed to comply with the requirements of the Banking Regulation Act.
 
“The continuance of Shree Mahalaxmi Urban Cooperative Credit Bank is prejudicial to the interests of its depositors. With its present financial position, it would be unable to pay its present depositors in full. The public interest would be adversely affected if the Bank is allowed to carry on its banking business any further,” the central bank says.
 
Due to the cancellation of its licence, Shree Mahalaxmi Urban Cooperative Credit Bank is prohibited from conducting business, including accepting fresh deposits and repaying them.
 
According to RBI, on liquidation, every depositor of Shree Mahalaxmi Urban Cooperative Credit Bank is entitled to receive a deposit insurance claim amount of his or her deposits up to a monetary ceiling of ₹5 lakh from the deposit insurance and credit guarantee corporation (DICGC).
 
According to data submitted by the Shree Mahalaxmi Urban Cooperative Credit Bank, 97.90% of depositors are entitled to receive the full amount of their deposits from DICGC. As of 9 June 2026, DICGC has already paid ₹88.21 crore of the total insured deposits based on the willingness received from the concerned depositors of the Karnataka-based lender.
 
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