South Indian Co-op asks RBI to up withdrawal limit

South Indian Co-operative Bank has made a representation to the Reserve Bank of India urging it to revise the withdrawal limit of depositors from the current Rs 1,000 to Rs 10,000.

The bank has approached the RBI to review the withdrawal ceiling and the RBI has expressed its readiness to increase it to Rs 5,000 though a formal letter from the RBI is awaited, said Mumbai Urban Co-operative Banks Association Ltd, chief executive officer, C Adsul.

The registrar of co-operative societies has superseded the SICB bank board and it has also appointed an administrator to monitor the day-to-day affairs and prevent any preferential payment, said banking sources.

The Maharashtra State Co-operative Bank Association and select co-operative bank representatives in a meeting with the RBI executive director A V Sardesai on August 14 urged the RBI to restore the 180 day accounting standard and permit credit disbursal to directors and relatives.

The Maharashtra State Co-operative Bank Association, chairman, Gulabrao Shelke also asked the RBI to consult MSC Bank, the UCB Association and federation and the management of UCB before taking any action against a co-operative bank.

The RBI assured the representatives that the government has appointed a task force which is looking into the issues faced by co-operative banks and will submit its report by October 31, said Adsul.

The task force is likely to examine the problems arising on account of dual control regime in co-operative banks and also contemplate on a new regulatory framework for UCBs, he added.