Read more about After RBI s paper on new regulatory framework, what next for NBFCs? on Business Standard. Over the last five years, their balance sheet more than doubled to Rs 49.22 trillion
Sahakar Bharati seeks Sec 80C benefit for term deposits of 5 years and above with UCBs
January 30, 2021
Satish Kashinath Marathe, Director, Central Board of Reserve Bank of India - PAUL NORONHA×
‘All financially-sound, well-managed UCBs be allowed to open Sukanya Samriddhi Account’
Term deposits of five years and above placed with all Urban Co-operative Banks (UCBs) should be considered as investments eligible for deduction under Section 80C of the Income-Tax Act, according to Sahakar Bharati.
Currently, under the term deposit category, only deposits placed with a Scheduled Bank for a fixed period of not less than five years are eligible for the aforementioned deduction.
Small Finance Banks have greater presence in well-banked States, says RBI report
January 21, 2021
SFBs penetration in the North-Eastern region remains low
Small Finance Banks (SFBs) have greater concentration of branch network in relatively well-banked States, according to an assessment in the Reserve Bank of India’s (RBI) latest monthly bulletin.
While there has been a rapid growth in the branch network of SFBs since their inception, this growth has been markedly concentrated in the Southern, Western and Northern regions, which are known as the relatively well-banked regions in the country, RBI officials Richa Saraf and Pallavi Chavan said in an article in the bulletin.
Road ahead for co-operative banks
January 17, 2021
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The RBI has powers now to regulate UCBs on par with commercial banks. Can depositors hope for a time-bound resolution?
Distressed depositors of several Urban Co-operative Banks (UCBs), including Punjab and Maharashtra Co-operative (PMC) Bank, Sri Guru Raghavendra Sahakara Bank, Rupee Co-operative Bank and Kapol Co-operative Bank, have been at their wits end.
With their hard-earned money stuck in these banks, which got into trouble for various reasons – deterioration in financial position, irregularities and deficiency in governance – the depositors have been desperately looking to the banking regulator for succour.
But the wait to get their money back is becoming excruciatingly long and arduous as the Reserve Bank of India (RBI) keeps extending its directions to these banks (ironically seeking to protect depositors’ interest) by three to six months. Depositors of Mumbai-based PMC Bank and Bengaluru-based Sri Guru Ragha
Maharashtra Urban Cooperative Banks Federation Chairman Vidyadhar Anaskar, who is credited with launching “Hath Jodo Abhiyan” asking UCBs to desist from converting into small finance banks–has strongly advocated taking consent of depositors before deciding on the conversion of UCB into SFB.
At present no UCBs in Maharashtra plan or apply to convert themselves into SFB, claimed Anaskar. He asks respective Urban Cooperative Banks for taking the depositors’ consent, apart from shareholders on any matter concerned with the conversion or merger of UCBs.
“The shareholders are having only five percent stakes in the bank and 80-90% stakes are that of depositors. Apart from taking member’s approval for merger or conversion, UCBs should take the approval of depositors also”, argues Anaskar.