RBI closed 4 banks, customers will get this much money back
RBI - Recently RBI took strict action against many banks, which includes cancelling the licenses of four banks. These banks are no longer allowed to do business and all transactions have been stopped by them. What will be the impact of this action of RBI on the customers... Let us know this in this news below-
Breaking News, Digital Desk- Reserve Bank of India (RBI) is the regulator of all banks and non-banking financial companies (NBFCs) in India. It ensures that these entities follow the rules and protect the interests of customers. In case of violation of rules or any activity against the interests of customers, RBI takes strict action.
In April, the RBI took strict action against several banks, including cancelling the licenses of four banks. These banks are no longer allowed to do business and all transactions by them have been stopped. However, customers of these banks are entitled to claim deposit insurance of up to ₹5 lakh on their deposits, which is provided by the DICGC (Deposit Insurance and Credit Guarantee Corporation).
This month, RBI has also imposed fines on 8 banks. All of them are accused of violating the rules. This list also includes City Bank, Punjab National Bank and Kotak Mahindra Bank. However, this action will not affect the transactions or agreements between the customers and the bank.
The license of these banks has been cancelled-
The licence of Anjana Urban Co-operative Bank Ltd., Aurangabad Maharashtra was cancelled on 22nd April.
The licence of Colour Merchants Co-operative Bank Ltd., Ahmedabad, Gujarat was cancelled on April 16.
The license of Imperial Urban Co-operative Bank Ltd., Jalandhar has also been cancelled. An order has been issued to close the banking business from 25 April.
The license of Shankarrao Mohite Patil Sahakari Bank Ltd., Akluj, Maharashtra has also been cancelled. The bank is not allowed to do business from April 11.
Why was the license cancelled?
The Reserve Bank of India has cancelled the licenses of some banks due to insufficient capital and profit prospects . According to RBI, the existence of these banks can pose a financial risk to the depositors. Their financial condition is so weak that they are unable to return their deposits to even their current depositors.
RBI imposed fine on these banks-
Aryavart Bank, Lucknow
Shri Ganesh Sahakari Bank Ltd., Nashik, Maharashtra
Citibank NA
Punjab National Bank
IDFC First Bank Limited
Kotak Mahindra Bank Limited
Indian Overseas Bank
Indian Bank