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Umbrella bodies of cooperative banks today met with the Reserve Bank and demanded deregulation of interest rate regime, besides better regulatory environment to work more effectively. The federations met central bank Deputy Governor Dr Subir Gokarn at the customary pre-policy meeting.
“We have demanded deregulation of the interest regime in the forthcoming annual monetary policy as in the current interest rate scenario we will continue to bleed. Today we are forced to lend at 7 per cent to the farm sector, while we are paying at least 9 per cent to our depositors. This situation just cannot continue,” the National Federation of State Co-operative Banks' managing director, Mr B. Subramanyam, said.
He further said the federation has demanded a higher interest subvention at around 4.5 per cent from the current 1.5 per cent.
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