RBI Screws On Another Bank, Money Withdrawl Stopped

RBI screws on another bank after LVB, now customers will not be able to withdraw money from this cooperative bank for six months.

The Reserve Bank of India has imposed a six-month ban on the withdrawal of funds from the Manta Urban Co-operative Bank in Maharashtra.

The Reserve Bank of India in a release on Tuesday said that it has given some instructions to the Manta Urban Co-operative Bank in the Jalna district of Maharashtra, which will be in effect for six months from the bank’s closure on 17 November 2020.

According to these instructions, this co-operative bank will not be able to give any loan or loan nor can renew old debts without obtaining written permission from RBI.

Apart from this, the bank will also not be allowed any type of investment.

RBI screws the bank from accepting new deposits. Apart from this, Manta Urban Co-operative Bank will not be able to make any payment nor can make any agreement to pay.

The central bank has said, “No amount can be deposited in any savings or current account, nor will the depositor be able to withdraw funds from any account.”

The central bank has stated that the bank will continue the banking business with restrictions until the financial situation improves.

It also stated that it could consider amending the guidelines depending on the circumstances.

The RBI said in another release that Bangalore-based Shushruati Souhrada Sahakara Bank Niyamita has been fined Rs 20 lakh for non-regulatory compliance.

Apart from this, the central bank has also imposed a fine of Rs one lakh on the Deccan Urban Co-operative Bank, Vijayapura, Karnataka.

The RBI has stated that these instructions will be effective for six months from the close of operations on November 17, 2020, and will be reviewed.

However, the RBI has also clarified that this directive should not be seen as the cancellation of the license of the cooperative bank by the RBI.