Reserve Bank of India (RBI) mandates three-year cooling-off period for co-operative bank directors

Key facts

• The Reserve Bank of India (RBI) has introduced a mandatory three-year cooling-off period for directors of Urban Co-operative Banks (UCB), State Co-operative Banks (StCB), and Central Co-operative Banks (CCB) who complete a continuous tenure of 10 years.
• The Banking Laws (Amendment) Act, 2025 increased the maximum continuous tenure for directors from eight years to ten years, effective August 1, 2025.
• The tenure ceiling for directors came into force for UCBs on June 29, 2020, and for StCBs and CCBs on April 1, 2021.
• During the three-year cooling-off period, former directors shall not be associated with the same bank in any capacity other than as a member or customer.
• For calculating continuous tenure, interruptions of less than three years are included, and only interruptions of at least three years reset the tenure calculation clock.