Context:
The Reserve Bank of India (RBI) is working on a new plan to set a figure for withdrawal under special conditions for depositors of the troubled New India Cooperative Bank to allow personal and medical emergencies financing, sources revealed Thursday.
Key Highlights:
- Proving emergency basis of withdrawal by depositor will be the watching criterion for assessing with drawability.
- The maximum limit of withdrawal will be up to ₹5 lakh, matching the limit for deposit insurance.
- This step follows the imposition of restrictions by the RBI on the bank last week, when deposit withdrawals and giving loans were barred for a period of six months due to liquidity concerns.
- There is no clarity if bank will resume working after this term, sources said.
Regulatory Context
- Currently deposits up to ₹5 lakh are insured by a default bank within a of a bank failure. Current payout is expected in 90 days.
- The RBI has appointed an administrator who will look into the working and financial health of the bank.
- The central bank has not yet responded to the media on the all encompassing matter.
This Is All About the Depositors
- People with dire medical or personal financial crises can be given limited access to their funds.
- The future of New India Cooperative Bank still stands very much uncertain, with no plan for a clear revival so far.
- They can keep abreast with any RBI update and possibly look out for other banking arrangements to secure the fate of their finances.
This goes to show that the RBI really handles banking crisis carefully, though howsoever lit upon the manner, it offers a small me
