Urban cooperative banks of National Capital Region have reacted in a mixed manner on the issue of latest RBI guidline on opening of Urban Cooperative bank with a seed capital of Rs 3 crore in place of Rs 15 lakh.

Talking to Indiancooperative.com Yatindra Mallik, Chairman of Keshav cooperative bank welcomed the move and emphasized. that it would be always better to take the opinion of urban cooperative banks before issuing guidelines. The mutual exchange of ideas would help UCBs to implement RBI guidelines better, he added.

Noble Cooperative bank supported RBI move while talking to the correspondent of indiancooperative.com. Noble bank is active in Noida and had to suffer the pain of shifting on accounts of Supreme Court directions against banks in residential area. V .K Sharma its CEO said that even otherwise it cost roughly Rs 50 lakh in opening a branch of a urban cooperative bank. But he resisted governmental effort to put cooperative banks on the same footing with corporate banks when it comes to regulation and supervision.

The Chief Executive of Citizen cooperative bank Shri Prem Mishra welcomed RBI move saying this would check fake banks from coming into existence. Such a step would also reduce the incidence of closing down of cooperative banks which are started without viable capital, he added.

Many other banks such as Jamia Cooperative bank felt that Rs 3 crore is a big amount given the nature and scope of cooperative banks. Such a move by RBI would discourage many prospective do-gooders who intend to help those marginalized sections of society no body is bothered with, they argue.

Manoj Kushwaha

The Supreme court direction to banks operating in residential areas in Noida to shut down immediately has caused much dismay among the urban cooperative bankers active in the region.

When the indiancooperative.com asked  bankers’ their reaction on the supreme court’s direction, they  said  they would  obey the court’s ruling but  they  would  face  serious   difficulties of  relocation.

Prem Mishra , secretary Citizen bank  said that they would demand suitable space  from  the   Noida authority so that they could continue to render their services to the local public.

The apex court has given this ruling while examining a public interest litigation in the matter.

However, Noble cooperative bank Chief Executive  V. K. Sharma  maintained that the citizens should have easy access to the banking services and therefore the court’s ruling  might cause inconvenience to the public.

As the banks  had no choice but to submit to the apex court’s direction , they would  ask the Noida development authority to provide them with suitable space.

Urban Cooperative Banks are a community banking service and are generally bare of the scale of economics of the Corporate banks. Removing them from residential areas would not only prove costly for the banks but also defeat the very purpose of serving the community by being easily accessible to them.