after modification banking regulation act, 1949, with effect from September 29, 2020, co-operative societies may not use the words “bank”, “banker” or “banking” as part of their names, except as permitted under the provisions of or under the rules Has been. reserve Bank of India (RBI).
RBI said in a statement that it has been learned that some co-operative societies are using the word ‘bank’ in their names. banking regulation act.
It has also come to the notice of RBI that some co-operative societies are accepting deposits from non-members/nominal members/associate members which amounts to carrying on banking business in contravention of the provisions of the Act.
“Members of the public are hereby informed that such societies have neither been issued any license under the BR Act, 1949 nor are they authorized by RBI to carry on banking business,” the RBI said.
In addition, insurance cover from Deposit Insurance and Credit Guarantee Corporation (DICGC) is also not available for deposits placed in these societies.
The central bank said that the members of the public are advised to exercise caution and caution regarding such co-operative societies if they claim to be banks and to refer to the banking license issued by RBI before dealing with them.