Kerala High Court's Stern Warning to Cooperative Banks: Restore Trust or Face Consequences

The Kerala High Court has emphasized that the cooperative banking sector must honor depositors' requests for the return of their money to maintain public trust. Judge Devan Ramachandran noted that failure to do so would severely damage the state's financial health. The court urged authorities to take proactive measures, including amending statutes, to protect depositors.

The Kerala High Court has issued a stark warning to the cooperative banking sector: honor depositors' requests for the return of their money or risk losing public trust. The court emphasized that such breaches could seriously harm the state's financial stability, especially given the current fiscal challenges.

Judge Devan Ramachandran articulated that the return of fixed deposits is essential for a healthy financial ecosystem. Any violation would inevitably create unrest among the public and deter them from relying on cooperative banks in the future.

The court's observations were made during hearings of multiple petitions from depositors seeking the return of their money. The court expressed dissatisfaction with the slow progress since the prior hearing, pushing the state to devise immediate solutions.

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