Reserve Bank of India has cancelled the banking licence of The Yashwant Co-operative Bank Ltd., Phaltan with effect from the close of business on May 19, 2026. The action was taken under Section 22 read with Section 56 of the Banking Regulation Act, 1949.

Following the cancellation, the bank has ceased all banking operations, including acceptance and repayment of deposits. The RBI has also requested the Commissioner for Cooperation and Registrar of Cooperative Societies, Maharashtra, to initiate winding-up proceedings and appoint a liquidator for the bank.

The central bank said the licence was cancelled due to inadequate capital and weak earning prospects, along with non-compliance with several provisions of the Banking Regulation Act, 1949. RBI further stated that continuation of the bank’s operations would be detrimental to the interests of depositors and against public interest.

According to the RBI, the bank in its current financial condition would be unable to fully repay its existing depositors.

On liquidation, depositors will be eligible to receive deposit insurance claims of up to Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC), subject to the provisions of the DICGC Act, 1961.

As per the data submitted by the bank, around 99.02 percent of depositors are entitled to receive the full amount of their deposits through DICGC insurance coverage. RBI also stated that as of April 20, 2026, DICGC had already disbursed Rs 106.96 crore towards insured deposits based on claims received from eligible depositors.