{"id":4476,"date":"2020-03-04T17:19:30","date_gmt":"2020-03-04T11:49:30","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=4476"},"modified":"2020-03-04T17:52:00","modified_gmt":"2020-03-04T12:22:00","slug":"banking-regulation-amendment-bill-2020-introduced-in-lok-sabha","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/banking-regulation-amendment-bill-2020-introduced-in-lok-sabha\/","title":{"rendered":"FM Introduces Banking Regulation (Amendment) Bill, 2020"},"content":{"rendered":"\n

The Banking Regulation Bill, 2020 has been introduced by the Finance Minister in the wake of the crisis at the PMC Bank last year.<\/em><\/strong><\/p>\n\n\n\n

The Honorable Finance Minister of India,\nNirmala Sitharaman on Tuesday introduced the Banking Regulation (Amendment)\nBill, 2020<\/em><\/strong> in Lok Sabha which seeks to give the Reserve Bank of India\n(RBI) the power to regulate cooperative banks<\/em><\/strong>. The Bill is proposed to\nstrengthen the cooperative banks by increasing professionalism, improving\ngovernance and ensuring sound banking through the RBI. The Banking Regulation\n(Amendment) Bill aims to prevent frauds<\/em><\/strong> as we saw in the case of \u201cPunjab and Maharashtra Co-operative (PMC)\nBank Ltd\u201d. <\/strong><\/p>\n\n\n\n

Statement of FM on\nBanking Regulation (Amendment) Bill, 2020<\/h2>\n\n\n\n

While presenting the Bill in the parliament,\nthe finance minister stated that it is the \u2018need of the hour\u2019<\/em><\/strong> to evade a PMC\nBank-like crisis in the near future. <\/p>\n\n\n\n

The FM mentioned that:<\/p>\n\n\n\n

\u201cPMC fraud had put a lot of small depositors in difficulty and people started demanding that the government should do something about it.\u201d<\/div>\n\n\n\n

The said bill seeks to amend the Banking Regulation Act, 1949<\/strong>[1]<\/strong><\/a><\/sup>. It is proposed to bring the cooperative banks at par with the developments in the banking sector through proper regulation and better management of cooperative banks. The Bill seeks to ensure that the affairs of the cooperative banks are conducted in a manner that protects the interests of the depositors.<\/p>\n\n\n\n

The proposed Bill will not be applicable to:<\/em><\/strong><\/p>\n\n\n\n

\"proposed<\/figure><\/div>\n\n\n\n

Currently, Co-operative Banks are under the dual\ncontrol of the Registrar of Co-operative Societies and the Reserve Bank of\nIndia (RBI)<\/em><\/strong>. The Registrar of Cooperative Societies are involved in\nincorporation, registration, management, audit, supersession of board and\nliquidation of co-operative banks while RBI is responsible for regulatory\nfunctions like maintaining cash reserve and capital adequacy, among others.<\/p>\n\n\n\n

Key Pointers of Banking Regulation Bill, 2020<\/h2>\n\n\n\n