Case Brief
What Happened
The Reserve Bank of India, by order dated March 27, 2024, imposed a monetary penalty of Rs 28.30 lakh on Nagpur Nagarik Sahakari Bank Ltd., Nagpur. The penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, following a statutory inspection and show-cause process. RBI found that the bank had not complied with directions on Interest Rate on Deposits and Know Your Customer (KYC), including lapses in paying interest on certain matured deposits/current account balances and failure to review the risk categorization of customer accounts at least once in six months. RBI clarified that the penalty is based on regulatory compliance deficiencies and is without prejudice to any other action that may be initiated.