RBI panel suggests umbrella body for helping smaller UCBs scale up

Says large UCBs that cannot function fully as a bank be treated like SFBs

An expert committee constituted by the Reserve Bank of India (RBI) has suggested an umbrella organisation for small urban cooperative banks (UCBs), which will allow them access to scale forming a network. The larger UCBs are allowed to operate on a standalone basis with regulations similar to those of banks. 

The RBI must help with grants to set up the umbrella organisation, and once it stabilises, “it may explore the possibilities of converting into a universal bank and offer value-added services on behalf of its member banks,” the committee report said.

“With suitable structural flexibility to operate as a bank, the umbrella