The RBI imposes financial penalties on these cooperative banks: Learn more

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The Reserve Bank of India (RBl) has levied a financial penalty of Rs 2.00 lakh (Rupees Two Lakh solely) on The Akola District Central Co-operative Bank Limited, Akola, Maharashtra (the financial institution) for non-compliance of KYC via a directive dated September 03, 2021. This penalty is enforced within the train of RBI’s powers below Section 47 A (1) (c) of the Banking Regulation Act, 1949, learn with Section 46 (4) I and Section 56 of the Banking Regulation Act, 1949, in mild of the financial institution‘s failure to comply with RBI’s directives. “This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” stated RBI.



RBI concluded that the aforementioned allegation of non-compliance with RBI directives was justified and merited imposition of financial penalty after analyzing the financial institution‘s responses and oral representations made in the course of the private listening to.

RBI has additionally imposed a financial penalty of Rs 50 lakh (Rupees fifty lakh solely) on Bombay Mercantile Co-operative Bank Ltd., Mumbai (the financial institution) in an order dated September 02, 2021. The central financial institution has stated that ” for non-compliance with directions issued by RBI contained in the Reserve Bank of India (Co-operative Banks – Interest Rate on Deposits) Directions, 2016 and specific directions dated March 05, 2018 and April 11, 2018 issued by RBI under the Supervisory Action Framework (SAF).”

“This penalty has been imposed in exercise of powers vested in RBI under the provisions of Section 47 A (1) (c) read with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949, taking into account failure of the bank to adhere to the aforesaid directions issued by RBI. The move is based on a deficit in regulatory compliance and the bank is not intended to disclose the legitimacy of any transaction or agreement with its customers, “the RBI said in a statement.




RBI has additionally positioned a financial penalty of Rs 1.00 lakh (Rupees one lakh solely) on The Kosamba Mercantile Co-operative Bank Ltd., Kosamba, Dist. Surat (Gujarat) (the financial institution) in an order dated September 02, 2021. For non-compliance with instructions issued by RBI contained within the Circular on ‘Loans and advances to administrators, kin and corporations/considerations during which they’re ‘ dated April 29, 2003, the financial slap has been issued. “This penalty has been imposed in exercise of powers vested in RBI under the provisions of section 47 A (1) (c) read with sections 46 (4) (i) and 56 of the Banking Regulation Act, 1949. This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” stated RBI.

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