RBI Revokes License of Shirpur Merchants Cooperative Bank

The Reserve Bank of India (RBI) has officially canceled the license of Shirpur Merchants Cooperative Bank. This decision stems from the bank's lack of sufficient capital and profitability prospects, prompting the RBI to take this step. In a statement released on Monday, the RBI indicated that as a result of the license revocation, the bank will cease operations on April 6, 2026, leading to the discontinuation of all banking services associated with it. The cooperative commissioner has been requested to issue an order for the bank's closure and appoint a liquidator.

What Will Happen to Depositors' Money?
Upon liquidation, every customer who has deposited money in the bank will be entitled to receive a maximum deposit insurance amount of ₹5,00,000 from the Deposit Insurance and Credit Guarantee Corporation (DICGC). According to the RBI, nearly 99.7% of depositors are eligible to recover their full deposit amount through the DICGC. As of January 31, 2026, the DICGC has already disbursed ₹48.95 crore based on the consent of the respective depositors.

Reasons Behind License Revocation
The RBI provided detailed information regarding the license cancellation, stating that Shirpur Merchants Cooperative Bank lacks adequate capital and profitability potential, making it unable to fulfill its obligations to current customers due to its financial condition. The central bank emphasized that continuing the bank's operations would be detrimental to the interests of its customers. Consequently, the bank is now prohibited from conducting any banking activities, including accepting deposits and making payments on deposits.