Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
24 Nov 2025
Case Brief
By an order dated November 20, 2025, RBI imposed a monetary penalty of ₹1 lakh on The District Co-operative Central Bank Limited, Kakinada, Andhra Pradesh. The penalty followed a statutory inspection by NABARD and a subsequent show-cause process, after which RBI sustained the charge that the bank had sanctioned a loan to one of its directors, violating Section 20 read with Section 56 of the Banking Regulation Act, 1949. RBI imposed the penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the BR Act.
Why RBI Acted
RBI imposed a monetary penalty after a statutory inspection (conducted by NABARD with reference to the bank's financial position as on March 31, 2024) and subsequent supervisory proceedings. RBI found that the bank had sanctioned a loan to one of its directors, contrary to Section 20 read with Section 56 of the Banking Regulation Act, 1949; the penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the BR Act.
Operating Impact
The bank must absorb the ₹1 lakh penalty, and the enforcement action may be followed by any other action RBI chooses to initiate. There is no indication of an operational restriction affecting depositors or borrowers beyond the monetary penalty itself.
Regulatory Basis
- Section 20 read with Section 56 of the Banking Regulation Act, 1949
- Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the BR Act
Action Facts
- Primary Impact
- Fine: Rs 1.00 L
- Order Date
- 20 Nov 2025
- Effective From
- 20 Nov 2025
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank