RBI imposes monetary penalty on The Bishnupur Town Cooperative Bank Ltd., West Bengal
Case Brief
RBI imposed a monetary penalty on The Bishnupur Town Cooperative Bank Ltd., West Bengal by order dated April 03, 2024. The penalty was for non-compliance with RBI’s Know Your Customer (KYC) Directions, 2016, specifically the bank’s failure to adopt a system of periodic review of risk categorization of accounts at least once in six months. The action followed a statutory inspection and show-cause proceedings under the Banking Regulation Act, 1949.
Following a statutory inspection with reference to the bank’s financial position as on March 31, 2023, RBI issued a show-cause notice for non-compliance with its KYC Directions, 2016. After considering the bank’s reply and oral submissions, RBI sustained the charge that the bank had failed to adopt any system of periodic review of risk categorization of accounts at least once in six months, and imposed a monetary penalty under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Severity Assessment
This is a monetary penalty of ₹1 lakh, which falls in the lowest monetary band and has no additional operational restriction.
The bank must absorb the ₹1 lakh penalty, and the order signals continued supervisory scrutiny of its KYC compliance framework. The release does not impose an additional operational restriction on customers or counterparties, but it indicates that further RBI action could still follow.
Published as The Bishnupur Town Cooperative Bank Ltd., West Bengal
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