Reserve Bank of India (RBI) take the strict action against the New India Co-operative Bank Limited, and restricted to issues new loans, accepts fresh deposits and suspends the withdrawals for next six months. RBI Strict Action marks the supervisory concerns and the bank’s liquidity position.
The restrictions panic account holders, and customers line up at outside of bank branches in Thane and Mumbai, and demands access to funds. Angry depositors with their fixed deposits (FDs) over Rs 40 lakh start protests outside the bank after this RBI Move. Fresh visuals from Mumbai also showed the account holders scramble for coupons distributed to access their lockers.
What behind the RBI Strict Action
RBI said that the actions were necessary because of concerns arising from “recent material developments” at the bank. It is important to protect the interests of depositors, although it did not expand on the specifics of concerns. According to the deposit insurance scheme, the eligible depositors are eligible to claim up to 5 Lakh. They have asked to submit their claims with bank. In the end of March 2024, the cooperative bank have deposits of Rs 2,436 crores.
People panic After RBI’s restrictions
The announcement by the central bank came into effect from 13 February 2025 and affects the account holders, and cause panic. Chaos of people arise outside the bank branches. According to directions, the bank is not allowed to dispose of their properties. It is not the first time when the RBI Strict Action take against co-operative bank.
In 2019, it put the restrictions on Punjab and Maharashtra Co-operative Bank (PMC Bank) after uncovers the financial irregularities. It consists of the under-reporting of bad loans. Later, Centrum Financial Services took over PMC Bank under RBI’s regulations.
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