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ARTICLE · 11 DECEMBER 2017

RBI Clarifies Co-Operative Societies Cannot Use The Word "Bank" In Their Names

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Hence, co-operative societies can maintain accounts and accept deposits from its members only.

IndiaFinance and Banking
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 The Reserve Bank of India (hereinafter referred to as "RBI") vide press release 2017-2018/14671 dated November 29, 2017, clarified that Co-operative Societies cannot use the word "Bank" in their names.

It had been earlier noticed by the Reserve Bank of India that some of the Co-operative Societies are using the word "Bank" in their names which is a direct violation of Section 7 of the Banking Regulation Act, 1949 (hereinafter referred to as the "B.R. Act")

  • Section 7 (B.R. Act)2 = No company other than a banking company shall use as part of its name [or in connection with its business] any of the words "bank", "banker" or "banking" and no company shall carry on the business of banking in India unless it uses as part of its name at least one of such words. No firm, individual or group of individuals shall, for the purpose of carrying on any business, use as part of its or his name any of the words "bank", "banking" or "banking company".

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