Tamil Nadu-based Repco Bank’s Managing Director R S Isabella urged Union Finance Minister Nirmala Sitharaman to frame a licensing policy for Urban Cooperative Banks during the DD Conclave organized recently at Chennai.
“The license to cooperative banks was last issued somewhere in 2004-2005. After that, no new banking licenses were given to Urban Cooperative Banks” Isabella reminded.
Speaking further she said these societies are eligible to apply either for Small Finance Banks, Payment Banks, or Universal banks. There are many co-op societies which are fulfilling the financial parameters but are suffering due to lack of an enabling framework”, Isabella’ asked.
Replying to her queries in the Tamil language, the Finance Minister Mrs. Nirmala Sitharaman assured the Repco Bank MD that the issue would be taken up with the Reserve Bank of India. “We are working to expand the banking networks in rural areas and even in the budget, we announced plans to connect post offices with the core banking system”, assured the Minister.
Under the Guidelines for ‘on tap’ Licensing of Universal Banks and Small Finance Banks, Sitharaman said she expected credit societies to take benefit from this scheme.
Appreciating the queries, Sitharaman said the government stands committed to encouraging small-size banks. “We will examine the issue with RBI”, said Sitharaman in the presence of Union Minister of State for Animal Husbandry, Dairying, and Fisheries Dr.L.Murugan.
Repco Bank along with other banks had applied for licenses to start a universal bank in the country in 2019 and the RBI had even made their names public last year. But the green light from the RBI is still awaited.
The bank has 1.2 million customers. The Business Mix of the Bank stood at Rs 16269 crore as of March 31, 2021, and earned a net profit of Rs 61 crore. The total deposits of the bank are more than 9,000 crore and total Advances hover around 8,000 crores.
The bank was established in 1969 with the prime objective of rehabilitating repatriates from Sri Lanka, Burma and Vietnam. The bank has a unique reputation for catering to the repatriate community.