New Delhi, Jun 24 () The federal government on Wednesday mentioned that each one city cooperative banks and multi-state cooperative banks will come underneath the supervision of the Reserve Bank of India, a growth geared toward offering consolation to depositors and stop repeat of PMC Bank like scams.
The President of India will promulgate an ordinance to this impact, Info and Broadcasting Minister Prakash Javadekar informed reporters after the assembly of the Union Cupboard.
Terming it a landmark choice, the minister mentioned 1,540 city cooperative banks and multi-state cooperative banks will probably be introduced underneath the RBI supervisory course of as is relevant in case of scheduled business banks. Commercial
“…depositors (of cooperative banks) will get safety and profit from this choice,” Javadekar mentioned.
There are 1,482 city cooperative banks and 58 multi-state cooperative banks having about 8.6 crore depositors with whole financial savings deposit of about Rs 4.85 lakh crore.
The choice assumes significance within the wake of a rip-off within the Punjab and Maharashtra Cooperative (PMC) Bank and another cooperative banks affecting lakhs of consumers who’re dealing with problem in withdrawing their cash because of restrictions imposed by the Reserve Bank of India.
The RBI had positioned regulatory curbs on the PMC Bank on September 23, 2019, after discovering out sure monetary irregularities and misreporting of loans given to actual property developer HDIL.
Earlier this month, the RBI had put restrictions withdrawals from Individuals’s Co-operative Bank, Kanpur, Uttar Pradesh. Finance Minister Nirmala Sitharaman had launched ‘The Banking Regulation (Modification) Invoice, 2020’ in Lok Sabha on March 3, 2020, which is pending approval. The proposed legislation sought to implement banking regulation pointers of the RBI on cooperative banks. Commercial
In her February 1 Funds Speech, Sitharaman had proposed amendments to the Banking Regulation Act with an goal to growing professionalism and enhancing governance among the many cooperative banks. NKD CS MR