People Queue Outside Karnataka Local Bank as India’s Apex Bank Imposes Restrictions

Clueless depositors on Tuesday queued up outside Sri Guru Raghavendra Co-operative Bank in India’s city of  Bengaluru after the country’s central bank RBI restricted the bank from doing business with immediate effect, capping withdrawal limits at $490 approx. (Rs.35,000).

According to reports, the depositors said that they were clueless if their hard-earned money was safe or not.

“We request the Chairman to hold a meeting with us and give us assurance about our money. While if a person is in need, he or she can’t withdraw more than Rs. 35,000. Where will he or she go?” said Nagaraj M speaking, one of the worried bank customers asked while talking to a regional channel.

A statement released by the RBI said: “In particular, a sum not exceeding Rs. 35,000 of the total balance in every savings bank or current account or any other deposit account may be allowed to be withdrawn, subject to conditions stated in the above RBI directions.”

It further stated that the bank will continue to undertake banking business with restrictions until its financial position improves and the licence of the bank has not been cancelled. It can continue to "undertake banking business with restrictions until its financial position improves".

The chairman of Sri Guru Raghavendra Cooperative Bank K. Ramakrishna claimed that 36 bad loans have locked up around $42 million of deposits which led to the RBI restricting them.

The ruling Bharatiya Janata Party lawmaker from Karnataka state Tejasvi Surya took to Twitter to say: “I want to assure all depositors of Sri Guru Raghavendra Co-operative Bank not to panic.”