Punjab Chief Minister Parkash Singh Badal on Friday urged the Union Finance Minister Arun Jaitley to direct the Reserve Bank of India (RBI) to allow the District Central Cooperative Banks (DCCBs) to participate in demonetisation scheme implementation.
Badal, in a letter to Jaitley, solicited the Union Minister’s attention towards a RBI circular stating that DCCBs are not allowed to accept specified bank notes as deposits and also not authorised to exchange the demonetised notes.
“In view of non-repayment of agriculture loans due to non-acceptance of demonetised banknotes by DCCBs, farmers are unable to avail the agri-credit needed for sowing Rabi crop. On the other hand, the decision brought the business of cooperative banks to a standstill,” he said.
He said that several DCCB branches are operational in areas where there is no presence of other public or private sector banks and asked Jaitley to advice the RBI to allow DCCBs to be a part of the demonetisation scheme to give relief to the farmers other people in exchanging old higher-value notes.
The Chief Minister said that acceptance of deposits or repayment of loans shall be strictly based on the instructions issued earlier.
Badal also said that the RBI notification, which instructs withdrawal of legal tender character of old `500 and `1,000 banknotes, was followed by a corrigendum which clarifies that ‘banks’ as defined under Banking Regulation Act, 1949, shall implement the demonetisation scheme.
In view of these instructions, DCCBs are licensed by the RBI and are part of the banking industry, hence these banks accepted Standardised Bank Notes (SBNs) of `500 and `1,000 denominations from November 10 to 13, he said.
Notably, DCCBs provide banking to nearly 10 lakh farmers apart from other general public, who have been approaching the branches of DCCBs for re-payment of their agriculture loans with the SBNs of `500 and
`1,000 denomination.