Page 18 - BF Cover January 2021.cdr

CO-OPERATIVE BANK NEWS

Co-Operative Bank

News

MCDCC Bank Launches The Sakkardara-based bank through its cancelled the banking licence issued to
Board of Liquidators had earlier Subhadra Local Area Bank Ltd,
Bharat Bill Pay App challenged the government's move in Kolhapur, citing problems in the way
Mysore and Chamarajanagar District lower court where the additional the bank was run.
Cooperative Central (MCDCC) Bank has sessions judge rejected its application The licence has been cancelled under
released 'Bharat Bill Pay App'. G.D. on September 30. This order was later Section 22 (4) of the Banking
Harish Gowda, Chairman of MCDCC challenged by the petitioner in high Regulation Act, 1949 and the order is
Bank, released it at a function. Bank court. made effective from close of business
customers can download Bharat Bill While allowing the bank's plea, justice on December 24, 2020, the RBI said.
Pay app in their mobile phone and can
Swapna Joshi permitted its board of
pay electricity and water bill and tax liquidators to operate the accounts with Explaining the action, the RBI said the
online. cancellation is on account of the fact
certain riders. "The petitioner should that the affairs of the Subhadra Bank
They can have information on submit a report in respect of the were conducted in a manner
transaction of their account and expenses to be incurred by the bank in detrimental to the interests of its
transfer money to other accounts with future. The monthly report of all present and future depositors.
ease. The App would put the brakes on expenses should be furnished before the
visiting various offices to clear the bills crime branch inspector here every first Public interest would be adversely
and save time. Since there is security week of the month," the judge added. affected if it is allowed to continue to
for online transaction, the customers The board, however, is restrained from do the business in the manner in which
can use facilities with ease, the using the bank accounts for any other it is functioning, the RBI said.
release said. expenses except those stated in the list. Further, the general character of the
According to petitioner's counsel SS management is considered prejudicial
HC permits Navodaya Ghate, after embezzlement was to the interest of the present and

Bank to operate accounts detected in the bank, proceedings future depositors and the bank had
breached the minimum net worth
under the Maharashtra Protection of
with conditions Interest of Depositors - MPID - In requirement for two quarters in the
The Nagpur bench of Bombay High Financial Establishments) Act, 1999 financial year 2019-20, the RBI said.
Court has permitted the controversial were initiated. "Consequent to the cancellation of the
Navodaya Urban Cooperative Bank licence, Subhadra Local Area Bank Ltd
Limited to operate its accounts in RBI cancels licence of is prohibited from conducting the
various banks. After the alleged Maharashtra-based business of 'banking' as defined in
misappropriation of over Rs 38.75 crore Section 5(b) or any additional business
surfaced in the bank, the state home Subhadra Local Area Bank envisaged under Section 6 of the
department had frozen its accounts. RBI on December 24 said it has Banking Regulation Act, 1949, with

18 | 2021 | JANUARY | BANKING FINANCE