Financing Minister Nirmala Sitharaman stated this legislation is for depositors’ security
In a bid to protect the interest of depositors, the Lok Sabha on Wednesday passed a change to the Banking Guideline Act to bring cooperative banks under the supervision of the RBI.
The Banking Guideline (Change) Expense, 2020 replaces a regulation that was released on June 26.
Responding to the argument on the bill, Finance Minister Nirmala Sitharaman said this legislation is for depositors’ safety and not for weakening powers of the Registrar of Cooperative Societies.
Powers of the Registrar of Cooperative Societies have actually not been encroached upon but banking activity of cooperatives will be controlled by the Reserve Bank of India (RBI), she said.
Urban cooperative banks and multi-state cooperative banks will be brought under the RBI’s guidance process appropriate to business banks.
There have to do with 1,482 city cooperative banks and 58 multi-state co-operative banks with a depositors base of about 8.6 crore.