Urban co-operative banks welcome Banking Regulation Ordinance 2020
14 Jul 2020 09:29:48
Business Bureau :
THE Banking Regulation (Amendment) Ordinance, 2020 was promulgated on June 2020 by the Union Government. It will have a widespread impact on the co-operative banking sector and will improve the proficiency of the sector was the general opinion expressed by chairmen of city’s leading co-operative banks. Sanjay Bhende, Director of the National Federation of Urban Co-operative Banks and Credit Societies Ltd (NAFCUB) and Chairman of Nagpur Nagarik Sahakari Bank Ltd, while talking to The Hitavada said, “Total supervisory powers converging at Reserve Bank, long awaited demand of the stakeholders in the co-operative banking sector has been fulfilled by the Union Government for which a special thanks to Nirmala Sitharaman, Finance Minister and Narendra Modi, Prime Minister.” Bhende said, this move is certainly a revolutionary step to integrate the banking sector and will definitely give energy and zeal in the co-operative banking sector.
The amendment was moved by the Central Cabinet in March 2019 initially and was confirmed on June 24. It was enacted recently through an ordinance. RBI will have all regulatory rights henceforth regarding supervision of the co-operative banking sector, excluding the Primary Agricultural Credit Societies and also co-operative societies engaged in the long term financing for agricultural development. “The amended act will now empower RBI to make a scheme for reconstruction or amalgamation without imposing moratorium,” Bhende said. Anil Sole, MLC and Chairman of Shikshak Sahakari Bank said, the move is in the interest of the depositors.
“Previously many permissions were to be taken by the RBI and Commissioner of Co-operatives. But now as a sole authority, RBI will have all control. These will bring more transparency in the working of the co-operative banks and the interest of the depositors will be safeguarded,” he said. He said, this amendments will boost confidence of the depositors while investing in the co-operative banks and will also put a rider on the working of the banks.