Thebeleaguered cooperative banks like the PMC, Madgaum Urban Cooperative Bank,Mapusa Urban Cooperative Banks under the guidelines of the RBI have beenreleasing funds to the public in a staggered manner which is unwarranted to saythe least. During these pandemic times when people's incomes have droppedconsiderably, the only reserves that they have are parked in these banks whichcannot be withdrawn as they wish to. To meet their contingencies inexpenditures towards home maintenance, school fees, marriages, etc cannot beimplemented for lack of funds. Most of the people's hard earned money insavings are parked in these aforesaid banks. Recently, the RBI has beenallowing releases of funds in a very staggered manner. Mapusa Urban Coop Bankwas sanctioned to release around Rs 214 crore to pay their depositors anddistressed loans commonly known as NPAs. Liquidations of assets is the otheroption. Ultimately these banks have to cough up all people's money, there is noescape route. Drastic heavy handed actions of cancelling the licences and alsoliquidations are uncalled for. Total closures by cancelling banking licencesfollowed by liquidations are unhealthy economic practices. Such closures areunwarranted especially during these low lean periods when the morale andconfidence has hit rock bottom.
RBI needs toinfuse fresh funds into the lifeline of these banks to keep them afloat.
