See
http://www.ioftpd.com/kb/view.php?kbid=70
Make sure you either have specified at least two users on the "masters=" line of your ioBanana.ini or, in case you don't want to (a dummy one would do though), that there is a space after the username.
Maybe imdb has changed since then. I'm not using v20 for months so I can't really notice such things myself. If someone can confirm this...
If I were you, I would check my firewall settings first. It might be blocking ioBanana.exe.
Edit ioBanana-text/zipscript.msg