PMC Bank amalgamation scheme

On January 25, 2022, the Reserve Bank of India (RBI) announced that, government has notified a draft scheme for amalgamation of Punjab & Maharashtra Cooperative (PMC) Bank with Unity Small Finance Bank (SFB).


  • Final scheme envisages to start pay-outs for depositors with around Rs 5 lakh in balance within one year, as opposed to two years in the draft scheme.
  • Furthermore, final scheme says Unity SFB must use recoveries made from loans given to Housing Development & Infrastructure (HDIL) Group, above & over the principal amount for buying back perpetual non-cumulative preference shares (PNCPS), that are issued to institutional depositors.

When will amalgamation come into force?

The amalgamation came into force with effect from date of the notification of the scheme, that is January 25, 2022. All the branches of PMC Bank will function as branches of Unity SFB, from this date.

Unity SFB

  • Unity SFB is promoted by Centrum Financial Services, in which BharatPe owner Resilient Innovation is a joint investor.
  • Unity SFB is required to transfer the amount received from Deposit Insurance and Credit Guarantee Corporation (DICGC) to all eligible depositors of PMC Bank, within 90-day period. Amount will be equal to the balance in their deposit accounts, up to Rs 5 lakh.
  • For Unity SFB with more than Rs 5 lakh in deposits, payout will be made in a staggered manner.
  • For every other liability of PMC Bank, Unity SFB will pay only principal amounts within a period of five years.

What are SFBs?

SFBs are a specific segment of banking, created by RBI, to undertake basic banking activities to underserved and un-served sections. Draft guidelines to license small banks in private sector were formulated and released in 2014, by RBI. SFBs were set up with the objectives of increasing financial inclusion.

Punjab & Maharashtra Co-operative Bank Limited (PMC)

PMC is a multi-state co-operative bank, starting operating in 1983. It has 137 branches, with 100 branches in Maharashtra. It is regulated by Reserve Bank of India. PMC has been registered under Cooperative Societies Act.



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