Page 20 - Banking Finance November 2020
P. 20
CO-OPERATIVE BANK NEWS
CO-OPERATIVE BANK
NEWS
NEWS
NEWS
NEWS
NEWS
RBI imposes penalty on 2 financial position as on 31 March last operative Society to provide savings
year, revealed inter alia, violation/non- accounts and loans to its customers
co-operative banks in compliance with the directions on per- and crypto investors in India. The soci-
Tamil Nadu and Karnataka mitting of withdrawals in excess of the ety has 56,000 customers and
RBI has imposed a monetary penalty stipulated amount and sanctioning of branches in Rajasthan, Delhi and
of Rs. 15 lakh on two co-operative fresh loans and advances in violation of Gujarat. The joint venture called
banks, including Millath Co-operative directions issued under Supervisory Unicas will offer interest on crypto
Bank, Davangere (Karnataka) and The Action Framework (SAF). deposits and the society will also give
Thiruvaikuntam Co-operative Urban Meanwhile, the inspection report of out loans against cryptocurrency.
Bank Limited, Thoothukudi (Tamil The Thiruvaikuntam Co-Operative Ur- Cashaa provides clearing services and
Nadu). ban Bank, based on its financial posi- offshore bank accounts to
Issuing a statement, the RBI said, "A tion as on 31 March, 2019, revealed cryptocurrency exchanges in India.
penalty of Rs. 10 lakh has been imposed that the bank had sanctioned loans to "For rupee loans against crypto, since
on Millath Co-operative Bank for non- its directors in contravention with the the cryptocurrency has to be depos-
adherence/violation of all inclusive di- directions issued by RBI in this regard. ited in our wallet as collateral, the
rections and other directions imposed Notices were issued to both the co-op- approval is instantaneous. The deposit
on the bank." erative banks. The RBI further added, acts as lien in case of default. This is
In another statement, the central bank "After considering their replies and much easier than taking loans against
said a monetary penalty of Rs. 5 lakh oral submissions made during the per- real estate where title deeds and other
has been imposed on the Tamil Nadu sonal hearing, RBI came to the conclu- documents have to be verified.
Co-operative Bank for contravention of sion that the charges of non-compli- Customers can also maintain crypto
the directions issued by the RBI on pro- ance with directions were substanti- savings accounts with Unicas and get
hibition of loans and advances to direc- ated and warranted imposition of interest in the same cryptocurrency as
tors. monetary penalty." the deposit. For instance a bitcoin de-
In both the above cases, the penalty posit will get interest in bitcoin, said
has been imposed based on deficien- Crypto platform makes Kumar Gaurav, CEO, Cashaa.
cies in regulatory compliance and is banking entry in India "We have 56,000 customers and 16 of
not intended to pronounce upon the branches. 90% of our branches are in
validity of any transaction or agree- with co-op credit society Tier 3 cities and mostly in Rajasthan, Delhi
ment entered into by the banks with tie-up and Gujarat. Through this tie up, we will
their customers, the statement read. Cashaa, a London-based online open up a new market and also open up
RBI said the inspection report of cryptocurrency platform, has tied up cryptocurrency savings accounts and
Millath Co-operative Bank, based on its with the United Multistate Credit Co- loans for our customers. We are very
20 | 2020 | NOVEMBER | BANKING FINANCE