Reserve Bank of India imposes monetary penalty on Axis Bank Limited
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹20 million on Axis Bank Limited by order dated January 29, 2019. The action was taken for non-compliance with RBI directions relating to the collection of account payee cheques and fraud classification and reporting. RBI said the penalty was imposed under Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, based on deficiencies in regulatory compliance.
RBI imposed a monetary penalty under Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949. The penalty was for non-compliance with the circular on ‘Collection of Account Payee Cheques – Prohibition on Crediting Proceeds to Third Party Account’ dated January 22, 2014 and the Master Directions on ‘Frauds – Classification and Reporting by commercial banks and select FIs’ dated July 01, 2016, reflecting deficiencies in regulatory compliance.
Severity Assessment
A ₹20 million penalty falls in the 3 band, and the action is a monetary penalty with no broader operational restriction.
Axis Bank must absorb the monetary penalty; the release does not indicate any restriction on its banking operations. The action serves as a compliance-enforcement measure and does not invalidate customer transactions or agreements.
Published as Axis Bank Limited
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