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Parliament on Tuesday approved the Banking Regulation (Amendment) Bill 2020 with the Rajya Sabha giving its nod for the Bill that seeks to protect depositors of cooperative banks and empower the Reserve Bank of India (RBI) to regulate banking activities of cooperative societies.
Lok Sabha had approved the Bill last week. Replying to the discussions on the Bill in the upper house on Tuesday, Finance Minister Nirmala Sitharaman asserted that the Bill is aimed at governing the activities of only those cooperative societies that function as banks.
“The changes being introduced through the Bill are required to protect the interest of depositors,” she said, adding that the Bill seeks to extend certain commercial bank rules to cooperative societies that function as banks.
The Bill also empowers the RBI to effectively handle mishaps in private banks without any loss of public confidence or disruption to the financial system. The central bank can go ahead with restructuring of the banking companies even without a moratorium being allowed.
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