Allow Local Cooperative Banks To Accept Old Currency: CM Badal to Jaitley

Chandigarh: Punjab Chief Minister Mr. Parkash Singh Badal today sought personal intervention of Union Finance Minister Mr. Arun Jaitley to direct the Reserve Bank of India (RBI) to allow the District Central Cooperative Banks (DCCBs) to participate in the implementation of the Scheme at par with other ‘Banks’ defined under Banking Regulation Act, 1949.

In a letter to the Union Finance Minister, Mr. Badal stated that the acceptance of deposits/repayment of loans shall be strictly based on the instructions issued earlier. The Chief Minister also apprised Mr. Jaitley that several branches of DCCBs were operational in areas where there was no presence of other public or private sector banks, which would also prevent the public particularly the farmers from facing inconvenience and ease pressure on the other banks.

Reiterating his request for prompt intervention, Mr. Badal impressed upon the Union Finance Minister to advice the RBI to allow DCCBs to be a part of this Scheme for giving relief to the farmers in particular and other public stakeholders in general.

Soliciting Mr. Jaitley’s attention towards the Circular No.RBI/216/17/130/DCM(Plg)/1273/10.27.00/2016-17 dated 14.11.2016 available on the website of RBI stating that DCCBs are not allowed to accept Specified Bank Notes as deposits from their customers and also not authorized to exchange the demonetised notes, Mr. Badal told the Union Finance Minister that in view of the non-repayment of existing loans of farmers due to non-acceptance of demonetised notes by DCCBs, the farmers have been put to extreme hardships as they were unable to avail the much needed agri-credit required for the sowing of Rabi Crop, the season for which has already commenced. On the other hand it has brought the business of the Cooperative Banks to a complete standstill.

The Chief Minister further brought in the notice of Mr. Jaitley that after RBI notification No.DCM(Plg)No.1226/10.27.00/2016-17 dated 8.11.2016 vide which instructions for withdrawal of legal tender character of existing Rs.500 and Rs.1000 Bank notes was followed by corrigendum No.SO.3418(E) dated 9.11.2016 which clarifies that the Banks as defined under Banking Regulation Act, 1949 shall implement the Scheme. In view of these instructions, DCCBs are licensed by the RBI and are part of the Banking industry, hence these banks accepted Standardised Bank Notes (SBNs) of denominations of Rs.500 and Rs.1000 from 10th to 13th November, 2016 (November 14th was a holiday in the State of Punjab).

Pertinently to mention here that DCCBs provide banking to nearly 10 lakh farmers apart from other general public, who have been approaching the branches of DCCBs for re-payment of their agriculture loans with the SBNs of Rs.500 and Rs.1000 denomination, read the letter.