RBI relaxed restrictions on 2 more banks, withdrawals and deposits. New order on money comes into force from today.
The Reserve Bank of India (RBI) keeps an eye on all the banks and NBFCs (Non-Banking Financial Companies) in the country. When a bank does not follow the rules of RBI, RBI can impose penalty on it.
Ban on Sarvodaya Co-operative Bank
Recently, RBI has imposed several restrictions on Sarvodaya Co-operative Bank of Mumbai. Due to the poor financial condition of this bank, customers are prohibited from withdrawing more than Rs 15,000 from their accounts. Deposit insurance up to Rs 5 lakh can be claimed from the Deposit Insurance and Credit Guarantee Corporation (DICGC). These restrictions have come into effect from 15 April 2024.
Action on National Urban Co-operative Bank
RBI has also imposed restrictions on National Urban Co-operative Bank located in Pratapgarh, Uttar Pradesh. Due to the poor financial condition of this bank, a withdrawal limit of Rs 10,000 has been set from the accounts. Similarly, customers here can also get insurance claim amount up to Rs 5 lakh from DICGC. These restrictions have also come into effect from April 15, 2024 and will remain in effect for 6 months.
The purpose of these restrictions is to ensure the financial stability of banks and protect depositors. This action of RBI does not amount to canceling the banking license, but is to ensure that the banks improve their financial position.
