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CO-OPERATIVE BANK NEWS

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RBI panel pushes for bank's sister concern shows that loans ferred into loan accounts including
worth Rs 60 crore were released to 90 premature closure of 49 fixed deposits
merger of weaker Urban accounts on a single day. of the society on the same day."

co-operative Banks Sri Guru Sarvabhauma Souharda Credit
Weak urban co-operative banks (UCBs) Co-operative Society, a sister concern WhatsApp to help rural,
could get a regulatory nudge to ex- of the bank, has lost about Rs 284 cooperative banks acceler-
plore voluntary merger or conversion crore to adjust to the bad loans of the ate digital banking
into a non-banking society at an early bank illegally. In 174 cases, it was seen
WhatsApp had gone live with its UPI
stage, going by the recommendations that Rs 149 crore benami loans were
of the Reserve Bank of India's Expert given without collecting any docu- payment service in November last
Committee on UCBs. Else, the powers ments. In a response given by Coop- year, after receiving a nod from the
for mandatory resolution would be erative Societies Minister ST National Payments Corporation of
employed. Somashekar to BJP MLA Ravi India(NPCI) nearly two years after its
initial pilot.
The committee, headed by NS Subramanya, it shows that the irregu-
Vishwanathan, a former Deputy Gover- larities of the society were parallelly WhatsApp will work with rural and co-
nor of the RBI, emphasised that all-inclu- being carried out with the bank. operative banks to accelerate the adop-
sive directions (AID) should be treated on The forensic auditing of the financial tion and usage of digital banking for
a par with moratorium under Section 45 year 2015-16 showed that Rs 64 crore their underserved customer base, India
of the Banking Regulation Act. was misappropriated in one year. head Abhijit Bose said on September 28.
"Last year, we had highlighted mobile
If AID is imposed, a bank should not An official from the society said, "the
continue thereunder beyond the time audit report says during 2015-16 we banking services from leading banks
permitted to keep a bank under mora- observed that on 27 November 2015, which had reached meaningful num-
bers; however for us, banking via
torium - three months extendable by 90 loans against deposits (LDA) ac-
a maximum of another three months. counts were created by extending a WhatsApp could only be achieved and
loan amounting to Rs 60 crore without be inclusive if we could replicate suc-
cessful mobile banking templates with
Karnataka co-operative any documentation, that is loan appli- rural and cooperative banks," Bose
cations, KYC and other documents. as
bank scam per the policy of the society, these said at Global FinTech Fest 2021.
While the Rs 1,500 crore irregularities loans should be granted by creating a Bose said that the first deployments
in Sri Guru Raghavendra Sahakara loan against deposits. However, our have begun with small finance banks
Bank Niyamitha (SGRSBN) in verification revealed that there were such as AU Small Finance Bank and
Bengaluru has pushed about 38,000 no deposits kept by these applicants. Equitas Small Finance Bank. "This is a
customers to hardship, the audit of the Interestingly, Rs 60 crore was trans- specific segment of banking created by

16 | 2021 | OCTOBER | BANKING FINANCE