RBI in Action: RBI has imposed restrictions on withdrawal of money from savings, current or any other deposit account in Mumbai’s New India Co-operative Bank.
The Reserve Bank of India (RBI) has imposed restrictions on withdrawal of money from savings, current or any other deposit account of a cooperative bank. Under this ban imposed on Mumbai’s New India Co-operative Bank, the bank will not be allowed to issue new loans or withdraw deposits. This step has been taken due to concerns related to the supervision of the bank.
2436 crore rupees deposited in the bank
According to the Economic Times report, depositors have the right to claim insurance up to Rs 5 lakh under the Deposit Insurance Scheme. Depositors have been asked to deposit their claims in the bank. As of the end of March 2024, this cooperative bank had deposits of Rs 2436 crore.
Why did RBI take action
The action comes after concerns over the bank’s liquidity position led the RBI to impose restrictions on withdrawals from savings, current or any other deposit accounts. The regulator has stressed that these measures have been implemented to protect the interests of depositors.
RBI will monitor the condition of the bank
RBI will monitor the situation of the bank and amend these directions to ensure the protection of depositors’ interests. These restrictions will remain in force for a period of six months starting February 13, 2025.
Kotak Bank got relief a day before
A day earlier, the Reserve Bank of India (RBI) has lifted the ban imposed on Kotak Mahindra Bank for more than nine months. With the removal of the ban, the bank can add new customers through its online and mobile banking platforms. Apart from this, the central bank has also approved Kotak Mahindra Bank to issue new credit cards. The ban on the bank was effective from April 2024. Under this, the RBI had banned the bank from digitally onboarding new customers and issuing new credit cards. HDFC Bank, the largest private sector lender, was banned for about 15 months till March 2022.
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