RBI imposes cash withdrawal restrictions and Seva Vikas bank loan sanction

Pune, October 13, 2021: The Reserve Bank of India (RBI) has imposed restrictions on withdrawing money from Seva Vikas
Cooperative Bank Limited, Pune.

In accordance with the notification, as of the close of business on October 12, 2021, the bank shall not, without the prior approval of RBI in writing, grant or renew loans and advances, make any investment, incur liability, including borrowing funds and accepting new deposits, disbursing or agreeing to disburse any payment, whether to fulfill its responsibilities and obligations or otherwise, enter into a compromise or arrangement and sell, transfer or otherwise dispose of any of its property or assets, except as directed in the RBI Directive dated October 12, 2021.

A copy of the notification is posted on the premises of the bank for viewing by interested members of the public. An amount not exceeding Rs 1000 of the total balance of all savings banks or checking accounts or any other account of a depositor, may be allowed to be withdrawn subject to the conditions set out in the RBI instructions above.

The RBI has clarified that the issuance of the above instructions by the RBI should not in itself be construed as the cancellation of the banking license by the RBI. The bank will continue to operate its banking activities with restrictions until its financial situation improves. The Reserve Bank may consider modifications to these instructions depending on the circumstances.

These instructions will remain in effect for a period of six months from the close of business on October 12, 2021 and are subject to revision, said Yogesh Dayal, chief executive officer of RBI.

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