Customers in panic mode as RBI imposes restrictions on?Mumbai-based New?India?Co-operative?Bank
New India Co-operative Bank has been barred from accepting or allowing withdrawals of funds by depositors and the restrictions would remain in force for a period of six months and are subject to review.
Long queues were seen outside Mumbai-based New India Co-operative Bank on Friday as panicked customers rushed to withdraw their deposits, only to be told that they could not access their savings. The development came after the Reserve Bank of India's (RBI) on Thursday evening imposed restrictions on NICB, located in Bandra, Mumbai.
CREDIT: BCCL
Restrictions on New India Co-operative Bank
The bank has been barred from accepting or allowing withdrawals of funds by depositors and the restrictions would remain in force for a period of six months and are subject to review.
The bank, however, is allowed to set off loans against deposits, subject to the conditions stated in the above RBI Directions. It may incur expenditure in respect of certain essential items such as salaries of employees, rent, and electricity bills.
What RBI said
"Considering the bank's present liquidity position, the bank has been directed not to allow withdrawal of any amount from savings bank or current accounts or any other account of a depositor," the RBI said.
CREDIT: BCCL
As per the RBI, the bank shall not, without prior approval, grant or renew any loans and advances, make any investment, and incur any liability, including acceptance of fresh deposits.
"These directions are necessitated due to supervisory concerns emanating from the recent material developments in the bank, and to protect the interest of depositors of the bank," the central bank said.
CREDIT: BCCL
Customers in shock
The RBI restrictions caught thousands of account holders off-guard.
"I have been banking here for 22 years. My wife and I have all our savings in this bank. Without any prior notice, we are now unable to access our money. We've been told to wait for 90 days -- but how are we supposed to manage until then?" Ajay More, a customer, told IANS.
"We rely on this bank for daily expenses. Had we been informed earlier, we could have secured our funds. This sudden freeze is unfair," Arbaaz Khan, another customer, said.
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Bobins Abraham is the Assistant News Editor at Indiatimes. He has more than twelve years of experience in TV and digital journalism. An avid student of history and geopolitics, he is a conservationist and environmentalist at heart. He writes on environment, sustainability, human-animal conflict and more.
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