RBI Canceled Bank License: The Reserve Bank of India has issued an order canceling the license of this cooperative bank on 14 July 2023 and its services have been banned from 19 July.
The Reserve Bank of India (RBI) has canceled the license of a co-operative bank in Uttar Pradesh. The bank on which action has been taken, its name is United India Co-operative Bank Limited (United India Co-operative Bank) and it is located in Nagina, Bijnor. The central bank has asked the commissioner and cooperative registrar to close this bank while banning its banking business.
Not enough capital and earning potential
The Reserve Bank has asked the UP Commissioner and Co-operative Registrar to issue an order to wind up the bank and appoint a liquidator. This action to cancel the license of United India Co-operative Bank has been taken under Section 56 of the Banking Regulation Act, 1949 of DICGC. RBI has said that the cooperative bank does not have sufficient capital and earning potential.
All services closed from 19 July
It has been said on behalf of RBI that the United India Co-operative Bank Limited does not comply with the provisions of Section 11 (1) and Section 22 (3) (D) as well as Section 56 of the Banking Regulation Act, 1949. All types of services of the bank have been banned from 19 July 2023 with immediate effect. For this, the central bank had issued an order on 14 July. Banned services also include depositing money and repayment.
Will get a deposit of Rs 5 lakh
According to Business Today, in its order canceling the license of this co-operative bank in Uttar Pradesh, the RBI said that as per the bank’s data, 99.98 per cent of the depositors of this bank are entitled to get their entire deposits from DICGC. . According to the central regarding liquidation, every depositor can claim his deposit amount up to the monetary limit of Rs 5,00,000 through the Deposit Insurance and Credit Guarantee Corporation.
This is the reason for canceling the license
The Reserve Bank said in its order that if this action taken on the United India Co-operative Bank has been taken keeping many aspects in mind. Public interest will be adversely affected if the bank is allowed to carry on its banking business. The major reason for this is that the bank with its current financial condition will be unable to pay its depositors in full.
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