In a statement that is sure to anger the co-op leaders, the chairman of State Bank of India, Rajnish Kumar, is quoted saying by the HT that cooperative banks should not give loans.
He said they are like small finance or payment banks that should function without providing loan facilities. Kumar was responding to a query related to the mismanagement of Punjab and Maharashtra Co-operative Bank (PMC).
“Reforms are required to improve the functioning of the cooperative banks. A cooperative bank giving away a big loan is not feasible for the system,” Kumar said.
He said there should be a single entity to govern their functioning as multiplicity of regulators confuse the matter further.