NUCFDC and IIA india join forces to transform audit and governance landscape of urban cooperative banks

THEBUSINESSBYTES BUREAU

MUMBAI, JULY 23, 2025

In a landmark development poised to reshape the governance framework of India’s Urban Cooperative Banking (UCB) sector, the National Urban Cooperative Finance and Development Corporation Ltd. (NUCFDC) has entered into a strategic partnership with the Institute of Internal Auditors India (IIA India). The alliance aims to embed international best practices in audit and risk management within UCBs — an essential step towards building institutional resilience and regaining depositor trust.

The Memorandum of Understanding (MoU), signed in Mumbai by Prabhat Chaturvedi, CEO of NUCFDC, and K. V. Mukundan, CEO of IIA India, signals a significant stride in the professionalisation of the UCB sector. At its core, the collaboration seeks to institutionalise robust internal audit frameworks and governance practices in alignment with globally recognised standards, including those issued by IIA and the Basel Committee on Banking Supervision (BCBS).

Riding on the Reserve Bank of India’s push for risk-based internal audits and international audit convergence, this alliance will play a pivotal role in enabling UCBs to meet emerging regulatory expectations. Under the agreement, IIA India will support NUCFDC in strengthening the sector’s audit capabilities, enhancing internal control mechanisms, and building capacity among key personnel—from internal auditors to top-level management.

The partnership brings a comprehensive suite of benefits to participating UCBs. These include access to IIA’s global knowledge network, the Internal Auditor magazine, “Tone at the Top” executive briefings, webinars, ESG-focused audit content, AI-integrated risk frameworks, structured training modules, and hands-on workshops. These resources are designed to enhance audit rigor, improve institutional transparency, and prepare UCBs for the rapidly evolving landscape of cooperative banking.

“Professionalising the Urban Cooperative Banking sector lies at the core of NUCFDC’s mandate,” said Prabhat Chaturvedi. “Our partnership with IIA India enables us to elevate internal audit as a cornerstone of sound governance and sustainable institutional development for our member organizations. This partnership helps us to deliver on that promise by elevating audit rigor and transparency.”

V. Mukundan, echoing the strategic importance of the collaboration, said, “This MoU represents a significant step in enhancing governance and transparency within urban cooperative institutions. At IIA India, we remain committed to bringing globally recognised internal audit standards and best practices to the grassroots of India’s financial system, ensuring UCBs are future-ready and professionally governed.”

The signing ceremony was attended by key industry leaders including Sumit Hans (Chief Business Officer, NUCFDC), Manish Solanki (President, IIA Bombay Chapter), and Rajiv Divadkar (Chief Growth Officer, IIA India), marking the beginning of a coordinated sectoral upliftment effort.

This strategic alliance comes at a critical juncture, as the cooperative banking sector grapples with heightened regulatory scrutiny and the need for reform. It also coincides with the UN-designated International Year of Cooperatives in 2025, highlighting the role of UCBs as vital engines of grassroots financial inclusion, transparency, and governance-led development.