Recorded RBI impact
Fine: Rs 4.00 L
Monetary penalty · Fresh imposition
Published by RBI
3 Jul 2025
Case Brief
By order dated June 30, 2025, RBI imposed a monetary penalty of ₹4.00 lakh on Shree Chhani Nagarik Sahakari Bank Limited, Vadodara, Gujarat. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 after RBI's statutory inspection found non-compliance with directions relating to KYC, customer protection for unauthorized electronic banking transactions, and cyber security requirements for primary (urban) cooperative banks. RBI said the bank failed to review risk categorisation of certain accounts at least once in six months, failed to provide 24x7 channels to report unauthorized electronic banking transactions, and failed to implement certain prescribed cyber security controls.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 after a statutory inspection as on March 31, 2024 and subsequent show-cause process. The bank was found to have failed to (i) carry out periodic review of risk categorisation of certain accounts at least once in six months, (ii) provide customers with 24x7 access to report unauthorized electronic banking transactions through multiple channels, and (iii) implement certain cyber security controls prescribed under RBI's Cyber Security Framework for Primary (Urban) Cooperative Banks, along with related KYC and customer protection directions.
Operating Impact
The bank must absorb the monetary penalty and address the compliance gaps identified by RBI. While the press release does not impose a separate operational ban, the findings signal heightened supervisory scrutiny over the bank's KYC, customer protection, and cyber security controls.
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 4.00 L
- Order Date
- 30 Jun 2025
- Effective From
- 30 Jun 2025
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank