The Reserve Bank of India (RBI) has cancelled the license of Lucknow’s HCBL Co-operative Bank with immediate effect. The central bank took this big decision on Monday and said that the bank did not have sufficient capital and earning prospects left, due to which this tough step had to be taken.

RBI clarified in a statement that the bank has stopped its operations from the evening of 19 May. Along with this, the Cooperative Commissioner and Registrar of Uttar Pradesh has also been requested to issue an order to close the bank and appoint a liquidator for it. So, if you also have an account in this bank, then this news is very important for you.

98.69% of depositors will get their full money back

In the process of closure of the bank, every depositor will be entitled to receive a deposit insurance claim amount of up to ₹ 5 lakh on their deposit. This security will be provided by the Deposit Insurance and Credit Guarantee Corporation (DICGC).

RBI said that as per the bank’s data, 98.69 percent of the depositors are entitled to get their entire deposit amount from DICGC. DICGC has already paid ₹21.24 crore out of the total insured deposits as of 31 January 2025.

Let us tell you that last month, RBI had taken action on many banks and cancelled the licenses of many cooperative banks. These included Colour Merchants Co-operative Bank of Ahmedabad, Ajanta Urban Co-operative Bank of Aurangabad, and Imperial Urban Co-operative Bank of Jalandhar.

RBI imposed a ban

RBI clearly stated that HCBL Co-operative Bank of Lucknow has failed to comply with certain provisions of the Banking Regulation Act, 1949, and the continuation of the bank is not in the interest of its depositors or customers. As a result of the cancellation of the license, HCBL Co-operative Bank has been banned from all banking operations, including deposits and withdrawals, with immediate effect.

This simply means that the customers of HCBL Co-operative Bank will neither be able to deposit money into their account nor withdraw money from the account. This is a big blow to those customers who had deposited their hard-earned money in this bank.