Odisha Government to refund depositors of defunct Urban Cooperative Bank

Bhubaneswar, Dec 26: The Odisha government has announced plans to refund depositors of the defunct Urban Cooperative Bank Limited in Bhubaneswar. Chief Minister Mohan Majhi revealed this decision during the launch of 1,542 Multipurpose Primary Agriculture Cooperatives (MPACs), emphasizing the government’s commitment to restoring public confidence in the cooperative banking sector.

The Urban Cooperative Bank, which received its banking license from the Reserve Bank of India (RBI) on September 7, 1987, experienced a decline in its financial health starting in 2003. Despite efforts to revive the bank through a Rs 6 crore investment in 2006, it ultimately ceased operations in 2015 when the RBI revoked its license after a proposed merger with Cosmos Cooperative Bank in Pune fell through. Consequently, approximately 13,797 depositors lost nearly Rs 30 crore, and outstanding loans totaling Rs 17.82 crore were unpaid by 1,760 borrowers.

In addition to the refund announcement, the Chief Minister outlined plans for 54 initiatives aimed at bolstering the cooperative sector. These include implementing model by-laws to enhance the functioning of Primary Agriculture Cooperatives, digitizing operations, supplying fertilizers and seeds, and establishing public medicine centers, common service centers, and agricultural service centers.