What Ails Primary Cooperative Banks : A Multidimensional Analysis

Primary Cooperative Banks, popularly known as Urban Cooperative Banks (UCBs), are increasingly becoming marginal players in the Indian financial system as their clientele share is increasingly being taken away by other banks. Despite their localised presence in large numbers and an important role in the last mile reach, they are unable to create a niche for themselves. UCBs face a considerable challenge, if not an existential one, requiring a multi-dimensional analysis of the issues internal to their working and functions. This paper offers a practitioner’s perspective on the subject. It highlights the critical issues concerning the cooperative structure, business model and positioning, capital and market relativity, scale, cost-efficiency, and governance relating to UCBs and suggests a way forward