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PMC BANK SCAM: Contractor broke, business comes to halt

Mumbai: A construction company contractor, Ravindra Kadam, finds himself in a soup after Rs 1.60crore of his funds are stuck in the Kanjurmarg branch of the Punjab and Maharashtra Co-operative (PMC) Bank. Kadam, who needs a constant flow of cash for business, is facing constraints now and this is causing him business setbacks. Since September 23, when the Reserve Bank of India (RBI) barred the PMC bank from doing business for six months and initially capped depositor withdrawals at Rs 1,000, the lives of thousands of traders, self-employed and daily wage earners were thrown into disarray. The following day, Kadam's associate wired Rs 5.76 lakh to his account and now the money is stuck.

Kadam, the only earning member of the family, supplies raw material for buildings and needs a constant cash flow to pay for the diesel used in heavy vehicles for transportation as well as to pay daily wages to the workers. "A day after the RBI imposed restrictions on the PMC Bank, one of my dealers had wired Rs 5.76 lakh in my PMC account through real-time gross settlement (RTGS), since he was unaware of the scam. Since the bank was restrained from carrying out transactions, they should have returned the amount. Now, even this amount is stuck," added Kadam. All his business transactions are on a daily basis. Since all of Kadam's finances are stuck in one place, he has nowhere to go.

The Kanjurmarg resident runs his business from the same area and earlier, he had an account with the Janakalyan Sahakari Bank Limited. Having heard good reviews of the PMC Bank, he opened an account with them, transferring all his funds. "Soon I began to use the PMC Bank as a primary bank for all my transactions. The news of RBI putting restrictions on PMC Bank came as a shock to me, as all my money, for personal and business use, was deposited in the bank," said Kadam.

After September 23, Kadam's business has gone for a toss and his professional engagements have come to a halt.