The Union Government on June 24 has decided to bring all cooperative banks under the Reserve Bank of India (RBI) through an ordinance. This was announced by Union Information and Broadcasting Minister Prakash Javadekar during a virtual press conference.
“Government banks, including 1,482 urban cooperative banks and 58 multi-state cooperative banks, are now being brought under supervisory powers of Reserve Bank of India (RBI),” Javadekar said today.
These banks will come under the supervision of RBI with immediate effect from date of President’s approval on the ordinance.
“Depositors’ money amounting to ₹4.84 lakh crore in the cooperatives banks will stay safe,” Javadekar said while announcing the decision.
Finance Minister, Nirmala Sitharaman, during her budget speech, had mentioned that the cooperative banks will be brought under the regulation of RBI. However, the Banking Regulation (Amendment) Bill, 2020, was not able to pass in the parliament’s budget session, as it was curtailed due to the COVID-19 pandemic.
The Union government has also decided to provide a 2% interest subvention to borrowers under the ‘Shishu’ category of the flagship Pradhan Mantri MUDRA Yojana (PMMY).