The Reserve Bank of India (RBI) warned some co-operative societies against the use of word "Bank" in their names.
- This is a violation of Banking Regulation Act, 1949 (As Applicable to Co-operative Societies)
- Some co-operative societies are accepting deposits from non-members or nominal members or associate members which tantamount to conducting banking business in violation of the provisions of the 1949 law, stressing such societies have neither been issued any licence under the act nor are they authorised by the RBI to undertake banking business.
- The RBI also advised the public to "exercise caution and carry out due diligence of such co-operative societies before dealing with them".
Banking Regulation Act, 1949
- The Banking Regulation Act Came into force with effective from 16th March 1949.
- Initially, it was named as “Banking Companies Act, 1949”, but latter the name was changed to Banking Regulation Act 1949 from 1st March 1966.
- This Act Provides safety in the interest of depositors.
- This Act forbids the misuse of powers by Higher Authorities/ Staffs / Banking employees etc.
- Bank Employee Can take leave according to this act.
