All the private or government banks in the country come under the Reserve Bank of India. RBI keeps an eye on the small and big steps of the bank.
If a bank does not work according to the guidelines of RBI, then RBI immediately cancels the license of the bank. Something similar has been done by RBI with Pune-based Rupee Sahakari Bank Ltd.
This bank will close its business from the coming September 22. The Reserve Bank of India canceled the license of Rupee Co-Operative Bank by issuing an order dated 8 August 2022.
This action has been taken by the Reserve Bank of India after the order of the High Court on September 12, 2017. According to RBI (Reserve Bank of India), all financial business of the bank will be closed from 22 September 2022.
RBI has also requested the Cooperative Commissioner and Registrar of Maharashtra Co-operative Societies to issue an order to close the bank and appoint a liquidator for the same.
Why was the license revoked?
This action has been taken on the part of the Reserve Bank of India due to non-compliance with the provisions of Section 11(1) and Section 22(3) (d) of the Banking Regulation Act, 1949.
The bank does not have sufficient capital. The Reserve Bank of India is of the view that it is not in the interest of the customers of the Bank to continue the business of the Bank. According to RBI, given the current financial position of the bank, the bank will not be able to pay the full amount to the depositors.
The bank has failed to comply with the requirements of sections 22(3)(a), 22(3)(b), 22(3)(c), 22(3)(d), and 22(3)(e).
