Sat Feb 15 16:47:36 UTC 2025: **RBI Takes Over Mumbai Bank, Leaving Thousands in Limbo**
MUMBAI – Panic gripped thousands of customers Friday after the Reserve Bank of India (RBI) imposed a six-month transaction ban on New India Co-operative Bank Ltd. The ban, effective Thursday, followed the discovery of irregularities in the bank’s lending practices.
Customers flocked to the bank’s 24 branches across Mumbai, Thane, Palghar, and Navi Mumbai, desperate to access their savings. While many were allowed access to their safety deposit boxes, all withdrawal requests were denied. Signs posted at branches indicated that deposits would be repaid within approximately 90 days. Police were deployed at several locations to manage the large and increasingly frustrated crowds.
The RBI not only banned transactions—including new loans, investments, and deposits—but also superseded the bank’s board of directors, appointing Shreekant, a former chief general manager of State Bank of India, as administrator for a year.
Customers expressed deep distress. One individual, Laxman Bhoir, feared the impact on his elderly, heart-patient mother upon discovering her locked-in savings. Others, like Jaydeep Gaikwad, faced immediate medical expenses they couldn’t meet. Many reported hours-long waits, with some instances of arguments and violence.
While the RBI stated that deposits up to ₹5 lakh are insured, uncertainty remains for those with larger sums. One senior citizen reported having recently deposited ₹75 lakhs. Even online banking and UPI payments were unavailable.
Advocate Shirish Deshpande of the Mumbai Grahak Panchayat criticized the six-month ban as excessively long and called for the RBI to engage directly with affected customers to find a solution. He highlighted concerns about missed loan payments and bill payments. The RBI had not responded to requests for comment at press time. The situation underscores the significant hardship faced by thousands reliant on New India Co-operative Bank.
First Piper 