Page 18 - Banking Finance November 2022

Co-Operative Bank

RBI cancels licence of Seva cus of this policy on free registration, erative (PMC) Bank, the government
computerisation, democratic elections, amended the Banking Regulation Act
Vikas Co-op Bank
ensuring active membership, profession- as applicable to cooperative societies.
RBI has cancelled the license of Pune alism in governance and leadership, The amendment, first issued as an or-
based Seva Vikas Co-operative Bank as transparency and accountability," said dinance in June 2020, gave RBI super-
the urban cooperative bank lacked Shah while addressing the inaugural visory powers over such banks. So far
adequate capital and earning pros- session of the two-day national confer- in 2022, RBI has fined 100 cooperative
pects. ence of state cooperative ministers. banks, as against 124 in 2021 and 22
The bank ceases to carry on banking Shah said the government in the next in 2020, showed data.
business, with effect from the close of two months will form a multistate co- Penalties imposed on these banks in-
business on October 10, 2022, RBI said. operative by merging four or five big clude Rs. 37.5 lakh for non-adherence
cooperatives at the national level for to fraud reporting guidelines; Rs. 25
According to the data submitted by
seed culture and marketing, and cer- lakh for non-compliance of norms on
the bank, about 99 per cent of the
tification of organic products, which housing finance; Rs. 15 lakh for devia-
depositors are entitled to receive the
will directly benefit farmers involved in tion from RBI's income recognition,
full amount of their deposits from De-
organic farming. "Along with this, asset classification and provisioning
posit Insurance and Credit Guarantee
Corporation (DICGC). As on September Amul, Iffco, Nafed, NCDC and Kribhco norms; and Rs. 10 lakh for violation of
are going to form a multistate export exposure norms, besides others.
14, 2022, DICGC has already paid Rs
house which will work to export khadi
152.36 crore of the total insured de-
products, handicrafts and agriculture RBI cancels licence of
posits.
products," he said.
Deccan Urban Co-opera-
Co-op model to spur pro-
tive Bank
RBI crackdown on Coop-
duction by masses The RBI said the licence of Deccan
erative banks gathers pace Urban Co-operative Bank, Karnataka,
Union home and cooperation minister
said mass production is necessary for Two years since the government has been cancelled as the lender does
economic development of India but vested more powers with the RBI to not have adequate capital and earning
"production by the masses" is also very supervise cooperative banks, the regu- prospects.
important for this country of 130 crore lator has tightened the leash on the As per the data submitted by the bank,
population, and this can be possible lenders, routinely imposing penalties
more than 99 per cent of the deposi-
only through the cooperative model. for deviating from regulatory norms.
tors are entitled to receive the full
"Our cooperative policy will take the After the crisis at erstwhile Mumbai- amount of their deposits from Deposit
country far ahead. We have set the fo- based Punjab and Maharashtra Coop- Insurance and Credit Guarantee Corpo-

18 | 2022 | NOVEMBER | BANKING FINANCE