Recorded RBI impact
Fine: Rs 3.00 L
Monetary penalty · Fresh imposition
Published by RBI
23 Oct 2023
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 3 lakh on Indrayani Co-operative Bank Ltd., Pimpri, Maharashtra. The penalty was imposed after RBI's inspection found non-compliance with directions on income recognition, asset classification, provisioning, and failure to implement a system for periodic KYC updation of customers. RBI said the action was taken under the Banking Regulation Act, 1949, and did not pronounce on the validity of any transaction or agreement entered into by the bank with its customers.
Why RBI Acted
RBI imposed a monetary penalty under section 47-A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 after inspection found that the bank had not adhered to prudential norms on income recognition, asset classification and provisioning, and had not implemented a system for periodic updation of customers' KYC. RBI concluded the non-compliance with the relevant RBI directions was substantiated.
Operating Impact
The bank must absorb the financial penalty and address the compliance gaps identified by RBI. The finding highlights obligations around prudential classification/provisioning and KYC maintenance, with no stated operational restriction on deposits or lending.
Regulatory Basis
- section 47-A (1) (c) read with Sections 46 (4) (i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 3.00 L
- Order Date
- 25 Sept 2023
- Effective From
- 25 Sept 2023
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank