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PMC Bank depositors to move Bombay HC for early refund, merger with running bank

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Depositors of the Punjab and Maharashtra Co-operative (PMC) Bank have decided to take grievances case to the Bombay High Court after failing to receive a precise timeline on the status of their deposits from either the regulator or the bank.

Speaking to  Manycontrol Sunday, June 20, the Coordinator of the PMC bank Depositors Action Team, Manjeet Sabharwal said that depositors could also look for a merger of PMC bank with any of the existing public or private bank so that they could receive their deposits sooner. He went on to say that the depositors will file the petition against the PMC Bank Board as well as the Reserve Bank of India (RBI).
“We are planning to move the Bombay High Court within the next few days and are currently preparing the petition in consultation with our lawyers. We are in no position to wait for another four to six months for deposit refund. It has been 20 months since the crisis began. How long can we wait?” Sabharwal questioned.
This comes as RBI provided ‘in-principle approval to Centrum Financial Services Ltd on June 18, 2021, to institute a small finance bank or SFB. This would allow Centrum to eventually take over PMC Bank. The RBI made it clear that this approval was granted based on Centrum’s offer from February 1, 2021, which was a response to the Expression of Interest notification published by PMC Bank on November 3, 2020.
However, news outlets are reporting that the depositors aren’t too keen on Centrum taking over PMC. “Only a running bank, private or public, can resolve our issues at the earliest. We are interested only in an early resolution. That’s what matters to us. Over 150 lives have been lost in connection with the PMC Bank crisis,” Sabharwal said.
Depositors of PMC Bank have waited for their funds since September 2019 when the PMC Bank Board was superseded by the RBI due to allegations of misgovernance including the running of fraudulent transactions. It’s worth noting that even though some depositors managed to get their money back under the RBI’s withdrawal plan, there are several people with larger amounts in the bank that are yet to get it back.
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