HomeLifestyleRBI canceled the license of this bank, did you have an account...

RBI canceled the license of this bank, did you have an account here?

New Delhi. The Reserve Bank of India (RBI) has canceled the license of Babaji Date Mahila Sahakari Bank Limited, Yavatmal, Maharashtra. The Reserve Bank said on Friday that the lender does not have sufficient capital and earning prospects, in view of which this step has been taken. Quoting data provided by the bank, the Reserve Bank said that about 79 per cent of the depositors are entitled to receive the full amount of their deposits from the Deposit Insurance and Credit Guarantee Corporation (DICGC).

DICGC has already paid Rs 294.64 crore of the total Sum Assured till October 16, 2022.

Know the reason for cancellation of license
Consequent upon the cancellation of its licence, the Babaji Date Mahila Sahakari Bank Ltd. is prohibited from carrying on the business of ‘Banking’ which, inter alia, includes preventing it from taking and making deposits with immediate effect.

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Announcing the cancellation of the license of Babaji Date Mahila Sahakari Bank after the closure of business on Friday (November 11, 2022), the Reserve Bank said that the bank does not have sufficient capital and earning potential. The Reserve Bank said that the bank with its current financial position would be unable to make full payments to its existing depositors, and public interest would be adversely affected if the bank is allowed to carry on with its banking business.

Even before this action was taken on another bank
The Reserve Bank of India (RBI) had earlier canceled the license of another bank in Maharashtra. RBI had canceled the license of The Laxmi Co-operative Bank Limited of Maharashtra. Also, in the instructions given to this bank, it has been said that they should also return up to Rs 5 lakh to their account holders.

After the order of the Reserve Bank of India, now Lakshmi Co-Operative Bank will not be able to do business or other financial work including transactions. A statement issued by the RBI said that every depositor will be entitled to claim up to Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC) under the provisions of the DICGC Act, 1961.

Tags: RBI, Reserve Bank of India

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