One year on, no end to the plight of PMC depositors

Are the depositors of urban co-operative banks (UCBs) children of a lesser God vis-a-vis those of commercial banks?

This is the impression one gets when the alacrity with which the government and the Reserve Bank of India (RBI) moved to restore depositors’ confidence in YES Bank is juxtaposed with the almost year-long struggle (and ongoing) of the depositors of fraud-hit Punjab and Maharashtra Co-operative (PMC) Bank to get their hard-earned money back.

While for the depositors of YES Bankthe uncertainty regarding the safety of their deposits ended in 10 days in March 2020, PMC Bank’s depositors have been left in the lurch for nearly a year now, with no indication yet from the authorities on whether the bank will be merged with another bank.

This differential treatment has rankled PMC Bank depositors, who are unable to grasp the reason for the delayed resolution of the matter.

PMC Bank depositors have been suffering as they can withdraw only ₹1 lakh (per depositor) of the total balance in their account for the entire 15-month period (from the close of business hours on September 23, 2019, till December 22, 2020) that the bank will be under RBI Direction.

Almost 70 depositors have died since the bank got into trouble. Some of these depositors took their own life.

Is our system heartless?

Among PMC Bank’s depositors, senior citizens have been hit the most. . Earlier, they would meet their monthly expenses from the interest earned on their deposits with PMC Bank. But with the clampdown on the bank’s operations, this sole income stream has stopped.

The picture/ videos of seniors protesting, despite the life threateningpandemic, is heart-rending enough. No concrete action yet from the authoritieshas only exacerbated depositors’ suffering.

Depositors are crying for a cohesive action between the RBI, Central and State governments so that they can get back their own money. A demonstration is being planned by some of the depositors outside RBI headquarters on September 23.

Depositors pour out their anguish

According to Chander Purswani, President, PMC Depositors Forum: “How can a person survive on ₹1 lakh (withdrawal cap per depositor) for 15 months? Can a government or RBI official survive on ₹6,667 per month? Then how do you expect us (many of us are senior citizens) to survive on this amount?

“This is mockery of our trust in the banking system. What is the depositors’ fault? The common man does not know the difference between a co-operative bank, a nationalised bank and a private sector bank.”

Film and TV actor Sudha Chandran said: “Can a family survive on the ₹1 lakh per depositor cap for 15 months? Then what ‘Acche Din’ are we talking about …We are feeling very let down. Everybody has turned a deaf ear. Nobody wants to listen.

“Imagine we are begging for our hard-earned money. Many senior citizens have put their life savings in the bank. We are not asking for money from the government treasury. We are asking for our own money.”

Revadhar Tiwari, 82, a former cab driver and one of the initial account holders of PMC Bank, observed that there has not been much communication from the bank on any further developments. He said: “The queues at the bank still continue. My savings are also locked in.”

Harsh Kalra, a former employee with the defunct Jet Airways, said: “All the savings of my mother and even my salary from Jet Airways are all locked in at PMC Bank. We are subsisting on my mother’s pension.”

An amended law

Depositors are now pinning their hopes on the Banking Regulation (Amendment) Bill, 2020, which was passed by the Lok Sabha on September 16for deliverance from their current misery.

The Bill seeks to protect the depositors of cooperative banksby extending regulation by RBI with respect to the cooperative banks’ management, audit, capital and winding up.