RBI canceled Karwar Urban Co-operative Bank license
The Reserve Bank of India (RBI) has canceled the license of Karwar Urban Co-operative Bank of Karnataka. This decision was taken on 23 July 2025, causing panic among thousands of account holders. According to the RBI, the financial situation of the bank had deteriorated and there was no practical possibility of running a further business. Now this bank will not be able to do any kind of banking work.
RBI has said that about 92.9% of the account holders of Karwar Urban Co-Operative Bank will get their deposit, but this relief is only for them, whose total deposit is Rs 5 lakh or less, they will be returned under the Deposit Insurance and Credit Guarantee Corporation (DICGC). So far, an amount of about Rs 37.79 crore has been returned to the account holders.
Account holders are worried
The news of the bank closure has made the local people sleep. Talking to the media, a woman, who has been holding her deposited capital in this bank for years, said, “I had added money for the marriage and treatment of children. Now it is afraid that everything should not be drowned.” At the same time, a shopkeeper from the area expressed concern, saying, “There was full faith in the bank, but now I do not understand what to do next.”
RBI has also clarified that this decision has been taken keeping in mind the public interest, so that customers do not suffer further losses in future. The Registrar of Co-operative Society of Karnataka has been instructed to start the process of immediate closure of the bank and appoint a liquidator.
Questions raised again on co-operative banks
The closure of Karwar Urban Co-Operative Bank has once again arisen that how strict and transparent is the monitoring of cooperative banks in the country. People living in small cities and towns often choose banks based on close and convenience, but it is clear from this incident that it is very important to understand the financial situation and RBI report of the bank.
What should the account holders do?
If your account is also in Karwar Urban Co-operative Bank, then there is no need to panic. The claim process has already started by RBI and DICGC. The bank’s customers can download their claim by downloading the form from the official website of DICGC. Apart from this, customers will also be given instructions in this regard from the bank.