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Deccan City Co-op Financial institution: RBI places Rs 1,000 withdrawal restrict for subsequent 6 months


New Delhi: The Reserve Financial institution of India has put restrictions on the Deccan City Co-operative Financial institution Ltd from granting recent loans or accepting deposits on Friday (February 19).

The Karnataka-based co-operative financial institution clients cannot withdraw greater than Rs. 1,000 from their financial savings account for the subsequent six months. The Reserve financial institution of India in an announcement mentioned “Contemplating the financial institution’s current liquidity place, a sum not exceeding Rs. 1,000 solely of the entire steadiness throughout all financial savings financial institution or present accounts or another account of a depositor, could also be allowed to be withdrawn.” It additional added that the instructions are set to stay in pressure for six months from the shut of enterprise on February 19, 2021 and are topic to evaluate.

The Deccan City Co-operative Financial institution Ltd has been prohibited from making any recent investments or incur any legal responsibility with out taking permission from the Reserve Financial institution of India.

“Nonetheless, 99.58 per cent of the depositors are absolutely lined by the Deposit Insurance coverage and Credit score Assure Company insurance coverage scheme,” mentioned the central financial institution. The RBI added that placing the financial institution underneath restrictions shouldn’t be mistaken as cancellation of its banking license.

The Deccan City Co-operative Financial institution Ltd will proceed work underneath restrictions till its monetary well being improves. The Reserve Financial institution of India will consider modifications within the orders as per the circumstances.

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