Bhubaneswar: President Ram Nath Kovind promulgated the Banking Regulation (Amendment) Ordinance, 2020, Saturday. The amendment will bring all urban and multi-state cooperative banks under the supervision of the Reserve Bank of India (RBI).
In Odisha, there are 17 urban cooperative banks, of which nine are functioning and others are on liquidity stage. If the state government implements the decision, the nine urban cooperative banks will come under the supervision of RBI, said a government official.
The nine urban cooperative banks are at Cuttack, Berhampur, Balasore, Puri, Rourkela, Paralakhemundi, Jeypore, Kendrapara and Bhubaneswar (Utkal Cooperative Bank).
About 1.98 lakh depositors are there in the above nine banks. These banks are having Rs 1,155 crore deposits and have provided loans to the tune of Rs 686 crore.
Former state finance minister Panchanan Kanungo welcomed the move and said, “It has been a long-standing demand. It will bring transparency and strengthen the cooperative banking system. Otherwise, the cooperative banks easily escape after doing irregularities like what happened during chit fund scam.”
The amendments do not affect existing powers of the State Registrars of Co-operative Societies under state co-operative laws.
It will not be applicable to Primary Agricultural Credit Societies (PACS) or co-operative societies whose primary object and principal business is long-term finance for agricultural development, and which do not use the words “bank”, “banker” or “banking” and do not act as drawees of cheques, the government clarified.
