The above is an article from HINDU. The following are some rel | ECONOMY by VIVEK SINGH

The above is an article from HINDU. The following are some relevant points.

1) Punjab and Maharashtra Cooperative (PMC) Bank is an Urban Cooperative Bank also called Primary Cooperative Bank.

2) In Sept. 2019, RBI superseded the management of PMC bank because of financial irregularities and appointed an administrator. [RBI can supersede the management of the Urban Cooperative Banks (UCB), State Cooperative Banks (StCB) and District Central Cooperative Banks (DCCB) if RBI feels that the affairs of the bank are conducted in a manner detrimental to the interest of the depositors. This is done as per the Banking Regulation Act 1949]

3) Then RBI invited bids from private banks/financial companies to take over the PMC Bank. And now the "Centrum Financial Services" in joint venture with "BharatPe" have decided to take over the PMC bank.

This news is combined with one other news.

In Dec. 2019 RBI had released guidelines for "‘on tap’ Licensing of Small Finance Banks in the Private Sector". 'On tap' means any financial services or few other fintech companies were allowed to apply/convert themselves into Small Finance Banks anytime by applying to RBI (ofcouse they should meet some minimum criteria). Here 'on tap' is important because in banking sector..............no one can just apply to RBI for a license to open a bank. It is RBI who decides and then publishes a notification that RBI is in the process of giving license for banks and then someone can apply. That is why 'on tap' Licensing becomes important because in this case RBI can be approached anytime for a bank license. But this 'on tap' licensing is only for 'Small Finance Banks'.
And in the 'on tap' guideline... RBI has allowed that Urban (Primary) Cooperative banks can also apply for conversion into Small Finance Bank. Even Payment banks have also been allowed to be converted into SFB.

So, PMC bank has been acquired by "Centrum Financial Services" in joint venture with "BharatPe" and it has been converted into a "Small Finance Bank".