Bhagyodaya Friends Urban Co-operative Bank Limited: The Reserve Bank of India (RBI) has canceled the license of Bhagyodaya Friends Urban Co-operative Bank Limited (Amravati) facing economic crisis. RBI says that the bank does not have sufficient capital and will not be able to return the entire deposit amount to its existing depositors. However, according to the data deposited by the bank, more than 98 percent of depositors will get the full amount from Deposit Insurance and Credit Guarantee Corporation (DICGC) based on their deposits.
Banking services stopped since Thursday
The RBI has also requested the commissioners of cooperative societies and cooperative societies of Maharashtra to issue an order for closure of the bank. The RBI said that the bank has failed to follow the requirements and the continuation of the bank is unfavorable to the interests of its depositors. Bhagyodaya Friends Urban Co-operative Bank Limited has stopped banking services since Thursday. On the closure of the bank, each depositor will receive a monetary insured up to Rs 5 lakh on their deposit as a deposit insurance claim from DICGC.
Relationship Finserv Private Limited is also under watch
Apart from this, micro finance company Sambandh Finserv Private Limited, surrounded by allegations of scam, is also under threat of cancellation of license. The Reserve Bank of India has issued a show cause notice to Micro Finance Company before the cancellation of the license of Samband Finserve. The RBI has asked Samband Finserv why the license of the company should not be canceled after such a big decline in its net worth. Actually, under RBI rules, it is mandatory for a non-banking finance company to maintain a fixed capital in the form of Tier-1 and Tier-2.