The Reserve Bank of India has amended its Rural Co-operative Banks Governance Directions, 2025 with immediate effect to require a director of a State Co-operative Bank or Central Co-operative Bank who has completed 10 years of continuous tenure on the same bank's board to wait at least three years before being reappointed to that board. The move targets cases where directors briefly resigned and then returned through election or co-option to extend their stay beyond the statutory limit. During the cooling-off period, the former director cannot be associated with the same rural co-operative bank in any capacity other than as a member or customer, although appointment to the board of another bank remains possible if the person is otherwise eligible. For calculating continuous tenure, service before an interruption of less than three years will still count, while service before an interruption of at least three years will not. RBI noted that the statutory ceiling for directors of State Co-operative Banks and Central Co-operative Banks was raised from eight years to 10 years by the Banking Laws Amendment Act, 2025, effective August 1, 2025.
Reserve Bank of India2026-05-25
Reserve Bank of India tightens rural co operative bank board tenure rules with three year cooling off after 10 years
The Reserve Bank of India has amended its Rural Co-operative Banks Governance Directions, 2025 to require a minimum three-year cooling-off period before a director who has completed 10 years of continuous tenure on a State Co-operative Bank or Central Co-operative Bank board can be reappointed to that board. During the cooling-off period, the individual may only be a member or customer of that bank, and tenure calculations will treat interruptions of less than three years as continuous service.