M.S. Co-operative Bank Ltd., Vadodara, Gujarat

RBI imposed a monetary penalty after a statutory inspection found non-compliance with directions on 'Interest Rate on Deposits' and 'Know Your Customer (KYC)'. The sustained charges were that the bank failed to pay applicable interest on unclaimed term deposits after maturity, on term deposits maturing on Sundays/holidays/non-business days and repaid later, and on certain current-account balances of deceased individual depositors/sole proprietorship concerns until repayment to claimants; it also failed to carry out periodic KYC updation for certain high-risk customers. The penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.

The bank must absorb the penalty and address the supervisory deficiencies identified by RBI. The order does not itself impose a new operating restriction, but it signals compliance expectations around deposit interest calculations and ongoing KYC updation for higher-risk customers.