Demonetisation is a historic event that would of course check the black money menace. But denial of currency exchange by co-operative banks took Kerala into a real financial crisis. The cooperative banking system that holds more than Rs 60,000 crore in deposits and has disbursed more than Rs 30,000 crore in loans has been paralysed because both the Reserve Bank of India and the Finance Ministry are suspicious of its dealings. Unlike in the case of nationalised and private banks, it's not a question of long queues, but a total collapse.
So what is needed is an immediate verification of shady deposits, if any, in co-op banks by RBI or IT department and give permission to operate them normally. The politics played by CPM, Congress and BJP should not damage the co- operative sector in Kerala.
K A Solaman
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