Struggling bank hopes for RBI relief

Over two weeks after the Reserve Bank of India (RBI) imposed stringent restrictions, including a cap of Rs 10,000 on withdrawals per customer, the Baghat Urban Cooperative Bank is struggling to stay afloat but remains hopeful of partial relief soon.

Under RBI’s directive, the bank must seek written approval before granting or renewing loans, borrowing funds or accepting fresh deposits. The apex bank also froze online transactions, forcing borrowers to physically visit branches to repay dues, a major setback in today’s digital landscape.

Managing Director Rajkumar said the bank has met most compliance conditions and is expecting the RBI to ease restrictions on online transactions shortly. “We’ve fulfilled the requirements and hope for a green signal soon,” he said, adding that branches have begun receiving lakhs daily as loan repayments pick up.

The bank’s 11,000 shareholders, who haven’t received dividends since 2018, continue to reel under financial strain. Once known for offering dividends as high as 15 per cent, the bank’s troubles have eroded trust among account holders.