RBI imposes monetary penalty on Shree Warana Sahakari Bank Ltd., Kolhapur, Maharashtra
Case Brief
RBI imposed a monetary penalty of ₹1 lakh on Shree Warana Sahakari Bank Ltd., Kolhapur, Maharashtra, by order dated August 22, 2023. The penalty was levied for non-compliance with RBI directions on maintenance of deposit accounts for primary urban co-operative banks, after inspection found that the bank was charging a fixed penalty for shortfall in minimum balance in savings bank accounts rather than a penalty proportionate to the extent of shortfall.
RBI imposed a monetary penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after statutory inspection and review of the bank's records showed non-compliance with RBI's directions on 'Maintenance of Deposit Accounts- Primary (Urban) co-operative Banks'. The bank was found to have collected a fixed penalty for shortfall in maintenance of minimum balance in savings bank accounts, rather than a penalty proportionate to the extent of shortfall.
Severity Assessment
This is a monetary penalty of ₹1 lakh, which falls in the lowest monetary band and there is no separate operational restriction.
The bank must absorb the penalty and ensure its deposit-account penalty practices comply with RBI directions going forward. The action does not state any restriction on operations, but it signals continued regulatory scrutiny over how the bank charges customers for minimum-balance shortfalls.
Published as Shree Warana Sahakari Bank Ltd.
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