September 23, 2021

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Financial institution alert! RBI cancels license of THIS financial institution, right here’s what is going to occur to depositors | Financial system Information

The Reserve Financial institution of India has cancelled the license of Bagnan, United Co-operative Financial institution Ltd, West Bengal. The Central financial institution has taken the choice after it discovered that the financial institution doesn’t have enough capital and incomes prospects, RBI mentioned in an order dated Might 10, 2021. 

Depositors don’t want to fret a lot, as they’ll obtain the total quantity of their deposits, due to the Deposit Insurance coverage and Credit score Assure Company (DICGC). Nonetheless, depositors are entitled to obtain declare advantages of as much as Rs 5 lakh.

RBI mentioned that within the present state of affairs, the financial institution wouldn’t be capable of pay its depositors the total quantity of their deposits. The method of liquidation will now being. 

The financial institution is now prohibited from conducting the enterprise of ‘banking’ which incorporates acceptance of deposits and compensation of deposits. “The continuance of the financial institution is prejudicial to the pursuits of its depositors,” RBI mentioned. 

“The Registrar of Cooperative Societies, West  Bengal has additionally been requested to challenge an order for winding up the financial institution and appoint a liquidator for the financial institution,” RBI mentioned in its official assertion printed on Thursday, Might 13. “Public curiosity could be adversely affected if the financial institution is allowed to hold on its banking enterprise any additional” RBI added.

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