In a move of wide-ranging significance, Purvanchal Co-operative Bank licence has been cancelled by the Reserve Bank of India (RBI). The RBI said the reason behind the action being taken against the Purvanchal Co-operative Bank, Ghazipur, Uttar Pradesh, was that it did not have adequate capital and earning prospects. RBI revealed that public interest would be negatively impacted if the bank is allowed to carry on its banking business.
Not just that, the RBI has also issued an order for winding up the bank and the appointment of a liquidator. This action would be taken by the Commissioner for Cooperation and Registrar of Cooperative Societies, Uttar Pradesh.
What happens to Purvanchal Co-operative Bank depositors?
The move will have filled the Purvanchal Co-operative Bank depositors with worry. What will happen to their money? Will they get it back? If yes, when will that happen? And how much of their money will they get back – all of it? Who will get their full money back and who will not?
According to a report by PTI, Purvanchal Co-operative Bank depositors would be entitled to receive deposit insurance claim amount of up to Rs 5 lakh only. This would be via the Deposit Insurance and Credit Guarantee Corporation (DICGC).
The RBI said that the Purvanchal Co-operative Bank data reveals about 99.51 per cent of the depositors are entitled to receive full amount of their deposits.
Purvanchal Co-operative Bank not able to pay
In a matter of concern, the RBI said that due to its present financial position, the Purvanchal Co-operative Bank would be unable to pay its present depositors in full. RBI said, “The bank does not have adequate capital and earning prospects.”
What Purvanchal Co-operative Bank can no longer do
The bank has been prohibited from acceptance of deposits and repayment of deposits, among other things.
DICGS Payback
As on May 30, 2024, the DICGC has already paid Rs 12.63 crore of the total insured deposits. This was done based on the willingness of the depositors.
Purvanchal Co-operative Bank licence has been cancelled by the RBI. What happens to depositors now? Will they get their money back? Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
