Digital Transformation: Ministry Launches Shared Services Entity to Boost Rural Cooperatives
In a major move to modernize rural credit delivery in India, the Ministry of Cooperation has launched a Shared Services Entity (SSE) for Rural Cooperative Banks (RCBs). This initiative, aimed at empowering these banks with digital solutions, was unveiled at a National Conference in Lucknow on Thursday.
A Digital Boost for Rural Banks
The conference, organized by NABARD, brought together key players from the cooperative banking sector including Chairpersons and Managing Directors of State Cooperative Banks (StCBs), District Central Cooperative Banks (DCCBs), NABARD officials, and other stakeholders. Dr. Ashish Kumar Bhutani, Secretary, Ministry of Cooperation, emphasized the crucial role of shared services in modernizing rural credit delivery through digital means.
The SSE, a long-awaited project, will provide scalable, secure, and cost-effective digital solutions to the 351 DCCBs and 34 StCBs across India. NAFSCOB President K. Ravinder Rao hailed this as a proud moment for the cooperative banking sector, noting that the SSE will be particularly beneficial to smaller banks struggling with high IT costs and limited manpower.
How the SSE Works
The SSE will function as a non-financial services private limited company under the Companies Act, receiving a Reserve Bank of India nod recently. It will have an authorized capital of Rs 1,000 crore, jointly contributed by NABARD (33.33%), the National Cooperative Development Corporation (NCDC) (33.33%), and Rural Cooperative Banks (RCBs) (33.33%).
The SSE will offer a range of shared IT infrastructure, including a centralized MIS server, cybersecurity solutions, regulatory compliance support, centralized payment systems, onboarding for Account Aggregators, cyber insurance, and more. Participating StCBs will contribute equity based on their share in the average business volume of the rural cooperative structure, with NABARD ensuring that this contribution can be made in installments.
Building a More Connected Cooperative Ecosystem
NABARD officials emphasized that the SSE is more than just an IT initiative; it’s a digital cooperative movement. With institutions like NAFSCOB, COBI, and others supporting the vision, this initiative aims to create a more connected and future-ready cooperative banking ecosystem.
The event, coinciding with the International Year of Cooperatives (IYC) 2025, concluded with a tree plantation drive at NBSC, Lucknow, where Dr. Ashish Kumar Bhutani, Siddharth Jain, Joint Secretary, MoC, and Shaji K.V., Chairman, NABARD, joined state officials in planting Rudraksha, litchi, and sapota saplings. This symbolic gesture marked the beginning of a new era for rural cooperative banking in India.
