Bad news! You can't withdraw more than Rs 35,000 from this bank now

In some very bad news for bank account holders, RBI has ordered that no more than Rs 35,000 of the total balance can be withdrawn henceforth. Yes, the customers of Sri Gururaghavendra Sahakara Bank Niyamitha, Bengaluru, Karnataka will not be able to withdraw more than Rs 35,000 from their savings bank or current account or any other deposit account! This has been informed by the Reserve Bank of India through a recent statement. The RBI has also ordered the bank not to grant any new loans or advances without its approval. The bank has also been asked not to make any investments or incur any liability including borrow funds.

"It is hereby notified for information of the public that in exercise of powers vested in it under sub section (1) of Section 35 A of the Banking Regulation Act, 1949  read with Section 56 of the Banking Regulation Act, 1949 (AACS), the Reserve Bank of India has issued certain Directions to Sri Gururaghavendra Sahakara Bank Niyamitha, Bengaluru, Karnataka whereby, as from the close of business on January 10, 2020, the aforesaid bank shall not, without prior approval of RBI in writing grant or renew any loans and advances, make any investment, incur any liability including borrowal of funds and acceptance of fresh deposits, disburse or agree to disburse any payment whether in discharge of its liabilities and obligations or otherwise, enter into any compromise or arrangement and sell, transfer or otherwise dispose of any of its properties or assets except as notified in the RBI Directions dated January 2, 2020, a copy of which is displayed on the bank's premises for perusal by interested members of the public," the statement from RBI read.

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"In particular, a sum not exceeding Rs 35,000/- (Rupees thirty five thousand only) of the total balance in every savings bank or current account or any other deposit account may be allowed to be withdrawn subject to conditions stated in the above RBI Directions," it added.

However, RBI clarified that the orders do not mean that the banking license of Sri Gururaghavendra Sahakara Bank Niyamitha has been revoked. It said that the bank will continue to undertake banking business with restrictions till its financial position improves. It said that modifications can be made in the directions depending upon the circumstances.

"These Directions shall remain in force for a period of six months from the close of business of January 10, 2020 and are subject to review," it said.