Go transparent and modernise or get left behind: Amit Shah tells coop banks

Urban cooperative banks must bring in transparency, introduce technology, train staff and provide modern customer services to ensure they remain competitive, Union Home and Cooperation Minister Amit Shah said on Saturday.

Shah was addressing a gathering of cooperative bankers after inaugurating a new office of NUCFDC (National Urban Cooperative Finance and Development Corporation), the umbrella organisation of urban cooperative banks (UCB).

According to him, the umbrella body will provide a new lease of life for UCB.

"From the umbrella organisation, we will get technical support. The compliances that Reserve Bank of India has put on us, we will get guidance. The new improvements in the banking sector, it will give us the information about it and many necessary software like Mule Hunter will also be available from there," said Shah.

He stressed that the sector has a lot to gain from transparency and that even UCBs can compete with other banks.

Shah felt that making India prosperous would require making every Indian prosperous and for that a strong system of self-employment would be needed. Capital markets alone will not be sufficient to fulfill this initiative and it was the cooperative banks that can do it, according to him.

"All areas related to employment, self-employment, be it a small shopkeeper or a small businessman, be it MSME, be it a self-help group for women, or even a small loan for middle class people, large banks can't fulfill it. But, it is the UCB in the taluka place that works to meet the needs of all these people," Shah pointed.

He also felt there was a need to change the perception gap between the RBI and UCBs, and that whenever the cooperative sector has confidently stepped up, the central bank had been proactively extending support.

Shah noted that as a regulator it was RBI's responsibility to ensure smooth functioning of banks and that depositors money remains safe. He said the umbrella body for UCBs was created for just that and therefore it was also the responsibility of the bankers to ensure that all the 1,400 UCBs joined this organisation.