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Due to inadequate capital and poor earning prospects, the Reserve Bank of India (RBI) has decided to cancel the registration certificate of United India Cooperative Bank Ltd, based in Bijnor, Uttar Pradesh.
Due to the revocation of its license, “United India Co-operative Bank Limited, Bijnor, Uttar Pradesh,” is now promptly restricted from conducting banking operations. This includes a range of activities, such as the acceptance and repayment of deposits, as defined in Section 5(b) read with Section 56 of the Banking Regulation Act, 1949.
As per the RBI’s assessment, United India Cooperative Bank lacks sufficient capital and promising earning prospects. Moreover, the bank has failed to comply with the banking regulation act’s requirements.
The RBI has determined that the bank’s continuation poses a threat to the interests of its depositors, as its current financial position may hinder its ability to fully repay its depositors.
As per the central bank’s guidelines, in the event of liquidation, each depositor would be eligible to receive a deposit insurance claim amount for their deposits, subject to a monetary limit of Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC).
According to the data provided by United India Cooperative Bank, an overwhelming majority of its depositors, specifically 99.98%, are entitled to receive the full amount of their deposits from DICGC.
A co-operative bank is a relatively small financial institution where its members act as both owners and customers. These banks operate under the regulation of the Reserve Bank of India (RBI) and are officially registered under the States Cooperative Societies Act.
These banks are established with the aim of serving the financial requirements of a specific community, such as a village or a particular group of people. Members come together to pool their resources and offer essential banking services like loans and savings accounts to support the financial needs of their community.
Chairman of Deposit Insurance and Credit Guarantee Corporation: Dr M.D. Patra
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