The Reserve Bank of India (RBI) has imposed restrictions on a cooperative bank, effectively freezing withdrawals for its customers. Upon hearing the news, a significant crowd gathered outside the Vijaynagar branch in Andheri, Mumbai. This bank, known as the New India Cooperative, now faces withdrawal bans from its customers.
Coupons for Customers
To maintain order, bank officials are issuing coupons to the crowd, allowing locker access. However, withdrawal permissions are denied, even for those who recently deposited their salaries. Affected customers cannot access their funds, regardless of their accounts.
Source: aajtak
What Are the RBI Restrictions?
The RBI has also banned the issuance of new loans and has suspended any withdrawal activities within the bank. This decision reflects the RBI's evaluation of the bank's financial health, aiming to safeguard against future insolvencies and ensure customer funds are secure.
Future of Depositors
By March 2024, the bank had deposits amounting to 2436 crore INR. Depositors are entitled to insurance claims of up to 5 lakh INR under the deposit insurance scheme, and they are advised to submit their claims to the bank.
Why the Action Against the Cooperative Bank?
The central bank's action stems from concerns over the bank's liquidity position. The RBI has restricted withdrawals from savings, current, or any other deposit accounts to protect depositor interests. These measures are intended to secure the funds of those associated with the bank.
