Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
13 Jun 2024
Case Brief
By an order dated June 07, 2024, RBI imposed a monetary penalty of ₹2 lakh on Nandani Sahakari Bank Ltd., Kolhapur. The action followed a statutory inspection and supervisory review that found non-compliance with RBI directions on ‘Gold Loan – Bullet Repayment – UCBs’ and ‘Management of Advances – UCBs’. RBI said the bank had sanctioned gold loans beyond the prescribed regulatory limit under the bullet repayment scheme, and the penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Why RBI Acted
RBI imposed a penalty after a statutory inspection (reference date March 31, 2023) and subsequent supervisory correspondence found non-compliance with RBI directions on ‘Gold Loan – Bullet Repayment – UCBs’ and ‘Management of Advances – UCBs’. The sustained charge was that the bank sanctioned gold loans beyond the prescribed regulatory limit under the bullet repayment scheme, warranting action under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must bear the financial penalty; the order does not itself impose an operational ban or customer-facing restriction. RBI also stated the penalty is without prejudice to any other action that may be initiated, so further supervisory or enforcement action remains possible.
Regulatory Basis
- section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Order Date
- 7 Jun 2024
- Effective From
- 7 Jun 2024
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank