PAWAR ASKS PM MODI TO HELP GIVE JUSTICE TO CO-OP BANKS
MUMBAI: Nationalist Congress Party (NCP) chief Sharad Pawar has criticised the Reserve Bank of India (RBI) over its alleged “untouchable” approach towards cooperative banks and asked Prime Minister Narendra Modi to intervene in the matter.
“The outlook of RBI is that the share of the cooperative banking sector in the overall banking sector is merely 3%... It has been insisting on the conversion of cooperative banks into private banks,” Pawar said in a letter to PM Modi on August 15.
“In the wake of the Punjab and Maharashtra Cooperative (PMC) Bank’s fallout due to a scam... to end existence of the cooperative banking sector, the Banking Regulation (Amendment) Bill, 2020, was introduced in Lok Sabha on March 3 by making several amendments in the provisions of the Banking Regulation Act, 1949, as suggested by RBI. When the Parliament was suspended due to Covid-19 and no discussion it could be held, the bill was converted into an ordinance on June 24,” the letter states.
Pawar said that he agreed that there should be financial discipline in the banks, but it would be incorrect to say that such a conversion of the cooperative sector into a private sector would completely or partially prevent misappropriation of funds, financial irregularities and frauds.
To prove his point, he shared data published by RBI regarding financial fraud in the banking sector for the last financial year.
“In the financial year 2019-20, an alleged fraud of ₹4,355 crore was identified in the PMC Bank scam, while during the first half of the year, fraud of approximately ₹95,700 crore was reported in nationalised banks. Therefore, it is not correct to say that misappropriation of funds or financial irregularities are observed in cooperative banks only,” Pawar mentioned.
“I therefore earnestly request you [Modi] to kindly look into the matter personally and give justice to the cooperative banking sector, which has a legacy of more than 100 years and is striving hard not only to exist but to grow despite all odds,” the veteran leader wrote.