Maharashtra Co-Op Bank Licence Cancelled, People Can Claim Up To 5 Lakhs

According to the Reserve Bank of India (RBI), Laxmi Co-operative Bank Limited has its license revoked since it lacks adequate capital and earning prospects and does not comply with regulations.

The order will be effective from today itself.

“The Laxmi Co-operative Bank Limited, Solapur, Maharashtra is prohibited from conducting the business of ‘banking’ which includes, among other things, acceptance of deposits and repayment of deposits as defined in Section 5(b) read with Section 56 of the Banking Regulation Act, 1949 with immediate effect,” said The RBI in a statement.

As a result of the RBI’s directive, the Commissioner for Cooperation and Registrar of Cooperative Societies, Maharashtra has been instructed to issue an order winding up the bank and appointing a liquidator.

As part of its liquidation plan, the Deposit Insurance and Credit Guarantee Corporation (DICGC) would pay deposit insurance claims totaling up to Rs 5 lakh to each depositor.

The DICGC is entitled to repay 99 percent of its depositors the full amount of their deposits based on the data submitted by the bank.

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