The central bank informed that this has become effective from the close of business on June 27, 2023. The Reserve Bank said that the Mahalaxmi Co-operative Bank Limited will continue to function as a non-banking institution. Explain that the Reserve Bank had given the license for Mahalaxmi Cooperative Bank on March 23, 1994.

Increasing strictness of Reserve Bank: Central Reserve Bank has been increasing strictness on co-operative banks for some time. For example, in April 2023, the Central Reserve Bank canceled the banking license of Adoor Co-operative Urban and allowed it to operate only as an NBFC. At the same time, in the financial year 2023, the licenses of nine lenders have been cancelled.

Earlier on Monday, the Reserve Bank had imposed penalty on seven cooperative banks for violation/non-compliance of certain norms. These co-operative banks were Textile Traders Co-operative Bank Limited, Ujjain Nagrik Sahakari Bank Maryadit, Panihati Co-operative Bank, The Berhampur Co-operative Urban Bank, Solapur Siddheshwar Sahakari Bank, Uttar Pradesh Co-operative Bank Limited and Uttarpara Co-operative Bank. There are banks.

The central bank had imposed a penalty of Rs 28 lakh on the Uttar Pradesh Co-operative Bank Ltd. A fine of ₹4.50 lakh was imposed on Textile Traders Co-operative Bank Ltd. Besides this, the central bank imposed a penalty of ₹2.50 lakh each on Panihati Cooperative Bank and Uttarpara Cooperative Bank. A fine of ₹1.50 lakh was imposed on Solapur Siddheshwar Sahakari Bank and ₹1 lakh each on Ujjain Nagrik Sahakari Bank Maryadit and The Berhampur Sahakari Urban Bank.

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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.

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