HYDERABAD: The Charminar Cooperative Urban Bank-like frauds would be a thing of the past, with the Union Cabinet on Wednesday deciding to bring all cooperative urban banks under the ambit of the Reserve Bank of India (RBI). This means the RBI will now control the business of these banks.
According to sources, there are 111 cooperative urban banks in Telangana and all of these would now come under the RBI’s watch. Prior to this, the cooperative urban banks were managed by the State Cooperative departments, with no security for investors’ money.
Several banks even duped many in the past. Welcoming the Union Cabinet’s decision, Eenadu Cooperative Urban Bank managing director K Tulasi Prasad told TNIE that as the RBI would take control over the business of the urban banks, depositors can feel secured about their money. Until now, the registration, conduct of elections and inspections were being done by the State Cooperative department, he said.
Telangana State Cooperative Apex Bank Ltd (TSCAB) managing director Nethi Muralidhar said there are two types of cooperative banks -- rural and urban. Urban banks further have two categories -- State limited cooperative urban banks and multi-State cooperative banks. These two are now under RBI’s control. Muralidhar said the cooperative rural banks, however, are not under the RBI. These are under the NABARD.