New Delhi, Jun 24: The government on Wednesday said all cooperative banks and multi-state cooperative banks will come under the supervision of the Reserve Bank of India, a development aimed at providing comfort to depositors of these banks. Urban cooperative banks and multi-state cooperative banks will be brought under the RBI supervision process applicable to commercial banks, Information and Broadcasting Minister Prakash Javadekar said while briefing media about the Cabinet decisions.
"Depositor will be assured his money is safe," he said. He said an ordinance in this regard will be promulgated. There are about 1,482 crore urban cooperative banks and 58 multi-state co-operative banks with a depositors base of about 8.6 crore. Urban Cooperative and Multi-State Co-Op Banks to be Brought Under RBI Supervision, Says Union Minister Prakash Javadekar.
Here's what Prakash Javadekar said:
The decision to bring 1,540 cooperative banks under RBI's supervision will give an assurance to more than 8.6 crore depositors in these banks that their money amounting to Rs 4.84 lakh crore will stay safe: Union Minister Prakash Javadekar https://t.co/IAy0GN98el
— ANI (@ANI) June 24, 2020
The decision assumes significance amid lakhs of depositors facing problems after a scam in the multi-state Punjab and Maharashtra Cooperative Banks. Earlier, the Cabinet had approved amendment to Banking Regulation Act to strengthen cooperative banks and avoid PMC Bank like crisis.