Tag Archives: Co-Operative Banks

RBI penalises Prime Co-operative Bank Ltd., Surat (Gujarat)


The Reserve Bank of India has imposed a monetary penalty of Rs5.00 lakh  (Rupees  Five Lakh only) on Prime Co-operative Bank Ltd., Surat (Gujarat).

The penalty is for violation of various RBI instructions relating to issuance of Demand Draft/Pay Order by the bank during the period from April 1, 2010 to March 31, 2013.

Way back in 1991, vide Notification No:DBOD.BP.BC.114/C.469 (81)-91 dated 19th April, 1991, Reserve Bank of India, had notified Banks, to issue travellers cheques, demand drafts, mail transfers, telegraphic transfers for Rs. 50,000/- and above by debit to customers accounts or against cheques only and not against cash.

This press release should enable the Banks to further strengthen their internal processes to ensure that there is no slippage of RBI instructions.


RBI again imposes penalty on The Bechraji Nagrik Sahakari Bank Ltd., Mehsana (Gujarat)

Way back in August 2011, RBI had imposed a penalty of Rs1lac on The Bechraji Nagrik Sahakari Bank Ltd., Mehsana (Gujarat). Again in May 2013, RBI has imposed a monetary penalty of Rs 1.00 lakh (Rupees one lakh only) on The Bechraji Nagrik Sahakari Bank Ltd., Mehsana (Gujarat)

This time the penalty is for violation of the RBI Directive No.5 dated April 29, 2003 read with Section 20 of the B.R. Act, 1949, (AACS) by granting loans to directors/relatives.


The RBI directive dt.29/04/2003, primarily deals with granting of loans and advances to the directors, their relatives and concerns in which they are interested.


In this context, the Joint Parliamentary Committee (JPC) which enquired into the stock market scam and matters relating thereto in paragraph 5.66 of its report (extracts enclosed) has made various recommendations. It has recommended that in order to prevent irregularities of the type which surfaced in the case of some of the cooperative banks examined by it, a full ban should be imposed on granting of loans and advances to the directors, their relatives and concerns in which they are interested.



Well, some cooperative banks seem interested always falling in the wrong books of RBI.

The Bundi Urban Co-operative Bank Limited, Bundi, Rajasthan – Penalised

The Bundi Urban Co-operative Bank Limited, Bundi, Rajasthan, has to remit Rs2.00 lakh (Rupees two lakh only) as a monetary penalty was imposed on it by Reserve Bank of India.

The monetary penalty was imposed for repeated violations of Reserve Bank of India directives relating to donation and levy of service charges on customers.

Levying monetary penalty for violation of RBI guidelines on services charges to customers is the first of its kind. RBI has also mentioned Section 26(6), of the Payment and Settlement Systems Act, 2007, as one of the reference point for arriving at the penalty.

This should be an eye-opener to other Banks-Big and Small, Public Sector and Private Sector, Indian and foreign, that charging excessive service charges is not in good spirit.

The major attraction of Bundi is the yearly Bundi fair held in November every year. The fair is hosted by the Rajasthan Tourist Corporation. This year the fair is scheduled to be held on Nov 1,2 and 3 I.e on a long weekend.

Over the years the fair has strarted to attract visitors not only from India, but also from overseas. The fair is a great opportunity to represent culture, folklore, traditions and craft of the region.

Some of the main attractions of the Bundi Utsav are Deep Daan, sight seeing, traditional rural sports, turban competition, bridal attire, musical band competition and dazzling fireworks display, which create a magical atmosphere.

During Bundi Utsav, Keshorai Patan, a small town close to Bundi, epitomizes the glance of Mini Pushkar in the silver embrace of moonlit night. The villagers, elegantly dressed in their traditional attire, gather at the serene banks of Chambal River. Women chant ritual songs, offer prayers and float lighted lamps into the river, creating a mesmerizing environment.

Jamnagar – Oil City of India

 The Jamnagar Peoples Co-operative Bank Ltd., Dist: Jamnagar – Penalised

 A monetary penalty of Rs1.00lac(Rupees one lakh) has been imposed on The Jamnagar Peoples Co-operative Bank Ltd, by Reserve Bank of India.

 The penalty was necessary for violation of RBI directives relating to (a) ceiling on exposure to individual non SLR investments and (b) prohibition from waiver of interest on a loan to an ex- director under the provision of section 20A of the Act. 

 Section 20-A r. w. 56(m)(i) and (ii) deals with Restriction on remitting director related debts :

 No co-operative bank shall, except with the prior approval of the RBI, remit in whole or part any debt due to it by,

1.Any of its past or present director

2.Any firm or company in which any of its directors is interested as director, partner, managing agent or guarantor

3.Any individual if any of its director is his partner or guarantor

 The Jamnagar Peoples Co-operative Bank Ltd., Bank is located in Jamnagar District, Gujarat. It has a total of two branches.

 Jamnagar is known as ‘Oil City of India’, as Reliance Industries, India’s largest private company, established the world’s largest oil refinery near the village of Moti Khavdi in Jamnagar. And is also home to an Essar Oil refinery, located near the town of Vadinar.

 Cricket fans too have a special affection to Jamnagar as Ranjitsinhji, a maharaja and graceful batsman, represented England while he made history as the first Indian to play test cricket.

 Jamnagar strategic location has attracted all the three wings of Defence. Indian Air Force, Indian Army & Indian Navy all the three wings have their training and big bases. Geographically Jamnagar supports all branches of defence as it has access to the sea for Indian Navy and a large Air Base including Army due to the city’s strategic location close to Pakistan