Nafcub has prepared its version on several of the UCBs issues for submission during the 35th meeting of the Standing Advisory Committee of RBI in Mumbai today (Friday).
The issues include Tenure of directors and their position in the vast majority of 1534 UCBs consequent upon amendment to the Banking Regulation Act 1949 through the Banking Regulation (Amendment) 2020 Act.
Nafcub has also prepared its stand in matters of UCBs where DICGC has paid depositors the insured amount under Sec 18 A of the DICGC Act, and loss of uninsured deposits by depositors, leading to no prospects of revival/merger of UCBs.
Issues like Branch Expansion & FSWMB, Measures taken by RBI to nudge UCBs to convert to SFBs & Imposition of lending norms of SFBs on UCBs, Imposition of new limits on Large Exposures and Priority Sector Loans are also on its agenda.
Resumption of issuance of licenses for new UCBs & Norms for voluntary conversion of large credit societies to UCBs, Resumption of issuance of licenses for new UCBs and Norms for voluntary conversion of large credit societies to UCBs are also on the table of NAFCUB.
Other matters pertain to creation of a dedicated vertical in RBI headed by a very senior ranked functionary exclusively for cooperative banks, UCBs be permitted to finance Primary Cooperatives engaged in different sectors of economy, Process of grant of Scheduled Status to UCBs, Conducting Government Business, etc.
On Housing Loans, Nafcub demands Enhancement in housing loan limits without increase in overall exposure limit to the Housing, Real Estate and Commercial Real Estate sector, Individual Women Beneficiaries – Priority Sector Category and Gold Loans by UCBs.
Nafcub also wants to discuss Criteria of Supervisory Action Framework (SAF), Unsecured Loans & Advances, Enhancement in maximum ceiling on Advances to Nominal Members, Inability to increase Microfinance, SHG loans and loans to weaker sections due to operations in urban area only.
Nafucb feels UCBs also to be permitted to sell their stressed assets to ARCs, Shift to / from HTM – Investment in securities, Provisioning for sale of NPAs, Expansion of counter parties, Constitution of Appellate Authority by RBI for hearing cases of imposition of penalties, One Time Settlement policy for UCBs.
Finally, Nafcub demands an update of RBI Master Direction KYC, 2016 (updated as on May 10, 2021) – periodic updation of KYC of customers, issues of Net Banking for UCBs and Increase in their C.D. Ratio.