The cases of Urban Cooperative banks falling under the lens of Reserve Bank of India abound in number. The latest in the series is Mirzapur Urban Co-operative Bank based in Mirzapur, Uttar Pradesh.
The Reserve Bank of India has, on September 1, 2014, cancelled the licence of The Mirzapur Urban Co-operative Bank Ltd.
The UCB cannot carry on banking business under Section 22 of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies) read with Section 56 of Banking Regulation Act, 1949.
As such, the bank is forthwith precluded from transacting the business of ‘banking’ as defined in Section 5(b) of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies) including acceptance/repayment of deposits, reads a press release of RBI.
