Cooperation Minister Amit Shah to launch NUCFDC on March 2

Cooperation Minister Amit Shah will launch the NUCFDC (National Urban Cooperative Finance and Development Corporation) on March 2. The NUCFDC is an umbrella organisation that provides technology and capital support to small urban cooperative banks.

The National Federation of Urban Co-operative Banks and Credit Societies (NAFCUB) -- the apex body of the urban cooperative banks -- has obtained the Certificate of Registration (CoR) for NUCFDC from the RBI (Reserve Bank of India) to function as a Non-banking Financial Company (NBFC). "NUCFDC is a game changer for the UCB sector. ...The umbrella organisation will also function as a self-regulatory organisation for the urban cooperative banking sector," NUCFDC chairman Jyotindra Mehta said in a statement.

The NUCFDC will be managed by the board of directors and CEO who have proven credentials in their respective areas of expertise and have been appointed as per the criteria prescribed by RBI, he said. The day-to-day operations will be managed by professionals with domain knowledge in the organisation that will be intensely technology-driven on a state-of-the-art IT platform, as per the provisions of the Companies Act.

The Urban Cooperative Banking (UCB) sector to have its umbrella organisation that will provide facilities of fund-based and non-fund based support to the urban banks, was discussed for nearly two decades. However, the RBI gave approval to the NAFCUB's proposal recently.

With a share capital of over Rs 119 crore subscribed by the urban banks, the NUCFDC has been issued CoR to function as NBFC by RBI. The share capital is to be increased to Rs 300 crore by further mobilisation in another twelve months.