The recent attempt to rob the Uttar Pradesh Cooperative Bank by compromising its cyber security has once again brought to the fore the urgency to have an Umbrella Organization for the UCB as soon as possible. The UO, among others, would also ensure high tech cyber security to even its weaker member banks.
R.S.Dubey, a retired manager of the Uttar Pradesh Cooperative Bank (UPCB) was suspected to have made the online attempt to withdraw Rs 146 crore from the official account of the bank. However, he did not succeed in his attempt, according to media reports.
The suspect R.S.Dubey along with his aide Ganga Sagar was taken into custody for interrogation. Meanwhile,10 staffers have been suspended by the bank for lapses.
VK Mishra, general manager of UPCB is quoted as saying, unidentified accused breached the online security system of the bank and tried to siphon off crores of rupees from the official account of the bank.
It bears recalling that some time ago even the RBI came out with a Technology Vision document aimed to strengthen the cyber resilience of the Urban Co-operative Banks. This was necessitated by the increasing cases of cyber fraud in co-op banking.
While smaller UCBs cannot afford to buy expensive technology on their own, there are several big UCBs which are also not fully protected from cyber frauds. Cosmos Bank is a case in point.
Reacting to the news, NAFCUB President Jyotindra Mehta says “Umbrella Organization is the answer to technological challenges for the UCBs. Here we can pool our resources and buy the best technology for us”, said Mehta.
Though in the recently held AGM of NAFCUB at the NCUI headquarters in Delhi, it was felt that the progress to set up Umbrella Organization has gained pace, the contributions of member UCBs have not been significant so far.
Exhorting UCBs, senior co-operator H K Patil asked them to be founder members of UO by contributing just a little- 10 paisa per every Rs 100 of assets (advances and investment)”.
It is being said that so far Rs 53 crore has been collected and received a resolution of more than Rs 25 crore. And the remaining amount will be collected before the completion of this financial year. The highest contribution made by Gujarat i.e. Rs 24 crore. Maharashtra contributed a mere Rs 3 crore.
Besides Cyber security, it needs to be noted that the national level Umbrella Organisation (UO) is expected to provide liquidity and capital support to member co-operative banks.
The UO will have an authorised capital of Rs 500 crore. Initial issued and paid up capital will be Rs 300 crore. The Steering Committee recommended that if each UCB contributes Rs 0.10 per every Rs 100 of assets, the above amount of Rs 300 crore can be contributed to the capital of the UO by all the UCBs.