RBI has constituted a High Powered Committee under the Chairmanship of Deputy Governor R Gandhi to re-examine and recommend appropriate set of businesses, size, conversion and licensing terms for the Urban Cooperative Banking Sector.

The committee will examine the line of businesses that UCBs may be permitted to undertake and their benchmark in terms of size of business, capital requirement, regulatory regime etc. It will also suggest the appropriate size up to which a UCB may be able to grow without undue risk to the system. The committee will further suggest the criteria for allowing voluntary conversion by a UCB. RBI has also asked the committee to examine whether the time is opportune to give license to new UCBs.

Lastly, the committee will determine the modalities of implementing the suggestion of the Malegam Committee that 50 per cent in value of deposits should be held by voting members or propose a feasible structure that puts majority voting in the hands of contributors of funds.

The eight member Committee consisting of experienced bankers will submit its report within three months from the date of its first meeting.