Case Brief
What Happened
By order dated September 21, 2023, RBI imposed a monetary penalty of Rs 1.62 crore on Indian Bank for breaches of RBI directions on Loans and Advances – Statutory and Other Restrictions, KYC Directions, 2016, and Interest Rate on Deposits Directions, 2016. The violations arose from supervisory inspection ISE 2021 and included sanctioning a term loan in place of budgetary resources without proper due diligence, allowing certain OTP-based e-KYC accounts to continue beyond one year without customer due diligence, and opening savings accounts for customers not eligible for such accounts. RBI said the penalty was imposed under the Banking Regulation Act after considering the bank’s reply and oral submissions.