Framework to regulate and oversee co-operative banks and deposits- (Press Information Bureau) (29 Nov 2016)
MANU/PIBU/0959/2016
Banking
Reserve Bank of India (RBI) regulates and supervises the banking functions of State Cooperative Banks (StCBs)/District Central Cooperative Banks (DCCBs)/Urban Cooperative Banks (UCBs) under the various provisions of the Banking Regulation Act, 1949 (As applicable to Cooperative Societies) and the Reserve Bank of India Act, 1934. However, the matters related to incorporation, registration, management, audit, liquidation, etc. in respect of these banks fall under the jurisdiction of the concerned Registrar of co-operative societies. Under Section 35(6) of the Banking Regulation Act, 1949 (As applicable to Cooperative Societies), National Bank for Agriculture & Rural Development (NABARD) has concurrent powers to inspect StCBs and DCCBs.
NABARD has reported that as on 31.3.2015, the total deposits with 33 StCBs and 371 DCCBs were Rs. 356467 crore. Out of these cooperative banks, 12 banks were having negative net worth as on 31.3.2015. NABARD has informed that these banks are servicing their depositors.
RBI has informed that it has prescribed uniform Know Your Customer (KYC) norms for all commercial and cooperative banks and its Master Directions on KYC guidelines are uniformly applicable to all banks in India. RBI has further informed that it does not have any information on whether extant KYC norms are causing many cooperative banks to be used for money laundering and tax evasion. However, some instances of violations of KYC/Anti Money Laundering (AML) guidelines in UCBs have been observed by RBI and 32 UCBs have been imposed an aggregate penalty of Rs. 119.50 lakh by RBI for KYC/AML violations from 1st July, 2015 to 30th June, 2016. NABARD has reported that the compliance to KYC/ AML is monitored during inspection of StCBs and DCCBs and these banks are required to submit Cash Transaction Report, Suspicious Transaction Report, Counterfeit Currency Report and Non-Profit Organization Report, etc. to Financial Intelligence Unit-India regularly.
Tags : DEPOSITS FRAMEWORK REGULATION
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