RBI Canceled License: The Reserve Bank has taken major action against a bank and canceled its license. Know what will happen to the money and deposits of customers having accounts in this bank.
RBI Canceled License of Bank: The Reserve Bank of India on Monday took major action against a bank and canceled its license. The bank whose license has been canceled is Shankarrao Pujari Nutan Nagari Cooperative Bank Limited, located in Kolhapur, Maharashtra. RBI has taken this step because the bank does not have sufficient capital and means of earning. RBI has ordered the bank to close all types of business from December 4, 2023.
The bank was short of capital
Issuing an official statement on this matter, the Reserve Bank has said that Shankarrao Pujari Nutan Nagari Sahakari Bank Limited, Kolhapur cannot provide any kind of banking services from December 4. Along with this, there has also been a complete ban on receiving payments or deposits at the bank. Giving information about the decision, the Central Bank said that this cooperative bank did not have sufficient capital to provide banking services. Along with this, the bank has also failed to present any concrete plan regarding the means of earning in future. In such a situation, it was not following the rules of RBI and keeping in mind the interests of the customers, RBI has decided to cancel the license of the bank.
What will happen to customers’ money?
After the license of this bank has been canceled by the Reserve Bank, the biggest question arising is what will happen to the customers’ money deposited in the bank? Bank customers get the facility of insurance cover from Depositors Insurance and Credit Guarantee Corporation (DICGC) on deposits up to Rs 5 lakh. DICGC is a subsidiary of the Reserve Bank of India which provides insurance facilities for sums up to Rs 5 lakh. In such a situation, customers who have deposited Rs 5 lakh or less in the bank will get the entire money back. Whereas customers with more than Rs 5 lakh can claim only for the amount up to Rs 5 lakh.
Fine imposed on these banks
Recently, the Reserve Bank of India has imposed heavy fines on many banks for not following the rules. In this, RBI has imposed financial penalty on three co-operative banks including HDFC Bank, Bank of America. Apart from this, RBI has also imposed penalty on Jijamata Mahila Cooperative Bank Limited, Shri Lakshmi Kripa Urban Cooperative Bank Limited, The Konark Urban Cooperative Bank Limited and The Chembur Nagarik Cooperative Bank Limited.
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