Karnataka has a special place in the Indian cooperative sector, as it is one of the first states to have started the cooperative movement. Urban Cooperative Bank, as the name suggests is a bank operating in urban areas on the basis of cooperative principles. Banking Regulation Act 1949 defined an Urban Cooperative Bank as a primary Non-Agricultural Credit Society. “Urban Cooperative Bank means a society registered under act and doing the business of banking, as defined in clause (b) of section 5 of the Banking Regulation Act 1949.

The UCBs which are generally considered as “Small People Bank” because of their objective for Promoting thrift and cooperation among the lower and middle strata of the society, has made its mark in the cooperative movement. 

The Karnataka State Cooperative Urban Banks Federation Ltd., Bangalore is an apex level body registered under the Karnataka State Cooperative Societies Act ,1959. The Urban Banks federation was constituted with an objective for promoting cooperative movement and for providing training and education to the urban banking sector.

The Urban Banks federation representing 266 Urban Cooperative Banks in Karnataka has been playing a pivotal role in implementing and organizing various activities for the overall development of Urban Cooperative Banks in Karnataka. The federation being part of various committees constituted by the Reserve Bank of India and Registrar of Cooperative Societies, is directly contributing to the healthy growth of the Urban Cooperative Banks in Karnataka


Ensure the emergence of sound and healthy network of jointly owned democratically controlled and ethically managed UCB’s providing need based quality banking services, essentially to the middle and lower middle classes and marginalized sections of the society in Karnataka State


  • Encourage structured development of urban banking movement in the state
  • Ensure that all UCBs comply with the regulatory prescription in letter and spirit
  • Facilitate implementation if CBS and innovative banking products so as to be on par with Commercial banks
  • Organize special programs for small and financially weak UCBs to educate such banks about the need to come out of weakness
  • Endeavour to create healthy image of UCB sector in the state
  • Conduct extensive online training programs for the officials of the UCBs
  • Strive for adopting state of the art technological innovations in the UCB sector
  • Educate directors and employees of UCB sector thorugh publication of news letters and magazines
  • Active functioning of Arbitration Courts and speedy disposal of cases enabling to reduce NPAs
  • Promote E Stamping services through large number of UCBs
Co-operative Principles

The co-operative principles are guidelines by which co-operatives put their values into practice.

1) Voluntary and Open Membership
Co-operatives are voluntary organisations, open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.

2)Democratic Member Control
Co-operatives are democratic organisations controlled by their members, who actively participate in setting their policies and making decisions. Men and women serving as elected representatives are accountable to the membership. In primary co-operatives members have equal voting rights (one member, one vote) and co-operatives at other levels are also organised in a democratic manner.

3)Member Economic Participation
Members contribute equitably to, and democratically control, the capital of their co-operative. At least part of that capital is usually the common property of the co-operative. Members usually receive limited compensation, if any, on capital subscribed as a condition of membership. Members allocate surpluses for any or all of the following purposes: developing their co-operative, possibly by setting up reserves, part of which at least would be indivisible; benefiting members in proportion to their transactions with the co-operative; and supporting other activities approved by the membership.

4)Autonomy and Independence
Co-operatives are autonomous, self-help organisations controlled by their members. If they enter into agreements with other organisations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their co-operative autonomy.

5)Education, Training and Information
Co-operatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their co-operatives. They inform the general public – particularly young people and opinion leaders – about the nature and benefits of co-operation.

6)Co-operation among Co-operatives
Co-operatives serve their members most effectively and strengthen the co-operative movement by working together through local, national, regional and international structures.

7)Concern for Community
Co-operatives work for the sustainable development of their communities through policies approved by their members.