Reserve Bank of India: The licenses of many co-operative banks have been canceled by the Reserve Bank of India in the financial year that ended on March 31.
If you also have an account in these banks, then you should be updated about this news. These banks have faced strict action from the Reserve Bank (RBI). Apart from canceling the license of banks, RBI has also imposed heavy fines on some banks. Co-operative banks have suffered the most in the action of RBI.
RBI imposed penalty 114 times
Recently, the licenses of eight co-operative banks have been canceled in the financial year 2022-23, which ended on March 31, 2023. Reserve Bank has imposed penalty on banks more than 100 times for not following the rules. Banking service has expanded rapidly in rural areas through co-operative banks. Due to the irregularities coming to the fore in these banks, RBI has taken drastic steps.
Allegations of negligence
Let us tell you that apart from dual regulation and weak finance, co-operative banks are facing interference from local leaders. The Reserve Bank has started cracking down on co-operative banks that are flouting the rules. Permits of eight banks have been canceled in the last one year. Let us know which banks’ permits were canceled by RBI?
Licenses of these 8 banks were canceled
1. Mudhol Co-operative Bank
2. Milath Co-operative Bank
3. Shri Anand Co-operative Bank
4. Rupee Co-operative Bank
5. Deccan Urban Co-operative Bank
6. Lakshmi Co-operative Bank
7. Sewa Vikas Co-Operative Bank
8. Babaji Date Mahila Urban Bank
RBI licensed the above banks due to insufficient capital, non-compliance with the rules of banking regulation. Also canceled due to reasons like lack of future earning potential. Co-operative banking sector is being monitored by RBI for the last several years. The central bank has canceled the licenses of 12 co-operative banks in the year 2021-22, 3 co-operative banks in 2020-21 and two co-operative banks in 2019-20.