Page 18 - Banking Finance September 2025

monitored by a two-tier mechanism
headed by Amit Shah.

UIDAI rolls out Aadhaar

framework for coopera-
tive banks
Ò»©­ In a major move to empower India's

cooperative banking network, UIDAI
has launched a new Aadhaar-based
authentication framework tailored for
cooperative banks. Announced on Au-
gust 21, 2025, the framework will bring
34 State Cooperative Banks (SCBs) and
ED conducts first-ever raid in Andamans in Rs 200 352 District Central Cooperative Banks
(DCCBs) under the Aadhaar ecosystem.
cr co-op bank scam
Developed with inputs from the Minis-
In a first-of-its-kind operation in the Andaman & Nicobar Islands, the En- try of Cooperation, NABARD, and
forcement Directorate (ED) raided nine locations in Port Blair and two in
Kolkata in a money laundering probe linked to the Andaman Nicobar State NPCI, the system aims to expand finan-
Cooperative (ANSC) Bank. cial inclusion and improve digital bank-
ing access in rural India. Under the
The case involves alleged misappropriation of over Rs 200 crore, with former model, only SCBs will be registered as
Congress MP and current vice-chairman of ANSC Bank, Kuldeep Rai Sharma, Aadhaar Authentication User Agencies
identified as the prime accused. Sharma was arrested by local police on July
(AUAs), while DCCBs can use their in-
18 for issuing fraudulent loans to shell companies and laundering the pro-
frastructure, reducing tech and cost
ceeds.
burdens.
A total of eight arrests have been made so far. The ED suspects Sharma This will enable easier onboarding
facilitated loans through 15 shell entities created for personal gain. A spe- through biometric eKYC and face au-
cial court extended his police custody on July 29, and the ED may seek fur- thentication, faster delivery of ser-
ther custody to trace and seize assets acquired using the suspected illicit
vices, and direct transfer of govern-
funds under the Prevention of Money Laundering Act.
ment subsidies and benefits. The initia-
tive aligns with the government's vision
Government unveils new societies by 30%, from 830,000 to over of making 2025 a landmark year for
a million. cooperatives, enhancing their credibil-
cooperative policy to
It mandates each village to host at ity and reach in semi-urban and rural
cover 500 million people least one cooperative and each tehsil areas.
The Centre has introduced a new Na- to have five model cooperative villages.
tional Cooperative Policy-its first up- The policy also stresses autonomous NAFCUB urges 42 credit
date since 2002-with the goal of ex- functioning, free and fair elections, and societies to apply for RBI
panding cooperative membership to democratic control of cooperatives.
500 million people from the current Currently, cooperatives contribute 14% banking licence
300 million. Announced by Union Min- to agriculture credit, 25% to fertiliser The National Federation of Urban Co-
ister Amit Shah, the policy aims to production, 31% to sugar output, and operative Banks and Credit Societies
boost the sector's contribution to the 85% to liquid milk distribution. A panel (NAFCUB) has called upon 42
economy over the next decade by in- chaired by Suresh Prabhu framed the shortlisted cooperative credit societies
creasing the number of cooperative policy, and its implementation will be to apply for a banking licence from the

16 | 2025 | SEPTEMBER | BANKING FINANCE