Give RBI sole and full authority over co-op banks, says central bank staff

Topics RBI | Co-operative Bank

The All India Reserve Bank Employees Association has in an open letter to the central government asked for ending the dual jurisdiction over cooperative banks, of the registrar of cooperative societies in each state and of the RBI. Samir Ghosh, the body's general secretary, said this "creates unwarranted dichotomy and gives scope for mismanagement and malfeasance. They should come exclusively under RBI jurisdiction, like banks".

The association says RBI should get complete regulatory powers over cooperative banks and start doing on-site supervision. The current “off-site surveillance”, they say, leaves gaps which are easily abused by the managements of these banks. It recalls similar suggestions they made in the late 1990s after the debacle at Madhavpura Mercantile Cooperative Bank. 

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