KOCHI: V N Vasavan, Minister for Co-operation and Registration, has said that the department would look into the Reserve Bank of India’s (RBI) directive asking the co-operative societies not to use the word ‘Bank’ in their names.
In the directive, which comes following the irregularities in some Kerala-based cooperative societies, RBI said “some co-operative societies are using the word ‘Bank’ in their names. This is a violation of Section 7 of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies) (the B.R.Act, 1949)”.
“Our cooperative societies are working as per the rules. It’s just that we are using ‘banks’ along with their names,” Vasavan told TNIE. As per the rule, the co-operative societies are supposed to accept deposits from only members. Our societies are accepting deposits only from members,” said the minister.
In its notice issued on Thursday, the apex bank said: “It has also come to the notice of RBI that some co-operative societies are accepting deposits from non-members / nominal members / associate members which tantamount to conducting banking business in violation of the provisions of the B.R.Act, 1949.”