The Reserve Bank of India (RBI) has placed operational restrictions on The U.P. Civil Secretariat Primary Cooperative Bank Limited under provisions of the Banking Regulation Act.

In a notification issued on March 11, 2026, the RBI directed that the Lucknow-based cooperative bank shall not grant or renew loans and advances, make investments, incur liabilities, borrow funds, accept fresh deposits, or disburse payments without prior written approval of the central bank. The bank has also been barred from entering into compromise settlements or disposing of its assets except as permitted under specific RBI directions.

Considering the bank’s liquidity position, the regulator has instructed it to suspend withdrawals from savings, current, and other depositor accounts. However, the bank may adjust loans against deposits as per the conditions specified in the RBI directive. It has been allowed to incur essential expenses such as staff salaries, rent, and electricity bills.

The RBI said it had engaged with the bank’s board and senior management in recent months to improve its functioning. However, due to inadequate corrective measures and concerns regarding depositor protection, the regulator decided to impose the restrictions.

Eligible depositors will be entitled to receive deposit insurance claims of up to Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC), subject to verification and submission of necessary documents under the provisions of the DICGC Act, 1961.

The central bank clarified that the issuance of directions should not be interpreted as cancellation of the bank’s licence. The bank may continue limited banking operations under the prescribed restrictions while the RBI monitors its financial condition.

The directions will remain effective for six months from the close of business on March 11, 2026, and are subject to review depending on the bank’s performance and depositor interests.