<h1>RBI curbs cooperative bank operations as financial stress triggers six-month freeze on depositor withdrawals and new lending</h1> RBI issued supervisory 'Directions' imposing temporary operational restrictions on The Valsad Mahila Nagrik Sahakari Bank for six months from close of business on December 18, 2025 due to deteriorating financial and liquidity position. The bank is prohibited from permitting any withdrawals from savings, current, or other depositor accounts, while being allowed to set off loan dues against deposits, thereby freezing depositor outflows during the direction period. It is further restricted from granting or renewing loans, making investments, incurring liabilities, or disposing of assets without prior RBI permission, thereby limiting new risk-taking and asset movements. Eligible depositors may claim deposit insurance up to Rs 5 lakh through DICGC, and the banking licence is not cancelled; the bank may continue business subject to these restrictions.