THIRUVANANTHAPURAM : Union Finance Minister Nirmala Sitharaman has backed Reserve Bank of India’s (RBI) caution notice against cooperative societies using the word “bank” in their names and accepting deposits from non-members.
“The press release issued by the RBI cautioning general public regarding the unlicensed and unauthorised activities of certain cooperative societies was in exercise of its powers and duties provided under the Banking Regulation Act,” the minister informed the Lok Sabha on Monday.
The minister said the RBI had received a letter from the Registrar of Cooperative Societies, Kerala, and another from the minister of cooperation and registration seeking withdrawal of the caution notice.
The RBI has informed that the notice was part of its duty and was in no way against the functioning of cooperative societies.
The minister’s statement was in reply to a question by Sougata Ray.
Quoting the RBI, the minister said some cooperative societies using the word “bank” in their names and accepting deposits from non-members/nominal members/ associate members was tantamount to conducting banking business without obtaining a banking licence from RBI.