Seized with the issue of large urban cooperative banks forced to lose their cooperative identity in the wake of RBI Panel’s High Powered Committee Report the NAFCUB President M L Abhyankar has called media persons of the capital to highlight the issue.
In the media invite received by Indian Cooperative NAFCUB says that it is the apex body of all the urban cooperative banks and credit societies in the country. There are about 1600 urban co-op banks and 50,000 credit cooperative societies in India.
We are organizing a press meet on the burning issue of RBI Panel recommending the conversion of urban cooperative banks into commercial entities. It amounts to handing over the 100 years old cooperative movement to private hands and contradicts the 97th Constitutional amendment that enshrines a person’s fundamental right to form a cooperative society, the invite reads.
RBI proposes that large urban co-operative banks be regulated under the Companies Act rather than under the Multi State Co-operative Societies Act. The Banking Regulation Act, which governs commercial banks, does not currently apply to co-operative banks. This means that RBI does not have the power to intervene in constituting boards of urban co-operative banks, removing directors, auditing them or liquidating them. It can intervene in all of these aspects in the case of commercial banks.