Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
11 Aug 2025
Case Brief
RBI, by order dated August 07, 2025, imposed a monetary penalty of ₹1 lakh on The Kasaragod Co-operative Town Bank Limited, Kasaragod, Kerala, following a statutory inspection with reference to its financial position as on March 31, 2024. The bank was found to have sanctioned loans and advances to certain connected borrowers beyond the applicable group exposure limit and to have failed to implement certain cyber security control measures and requirements under RBI’s Cyber Security Framework for Primary (Urban) Cooperative Banks. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after a show-cause process and hearing.
Why RBI Acted
RBI imposed a monetary penalty after supervisory inspection found that the bank had sanctioned loans and advances to certain connected borrowers beyond the applicable group exposure limit, and had not implemented certain cyber security control measures and requirements prescribed under RBI’s Cyber Security Framework for Primary (Urban) Cooperative Banks. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, following a show-cause notice and consideration of the bank’s reply and oral submissions.
Operating Impact
The bank must bear the monetary penalty, and the order may also leave room for further RBI action based on the same compliance deficiencies. There is no stated operational restriction on the bank’s business in this release, but the underlying lending and cyber security compliance issues remain relevant for supervisory oversight.
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 1.00 L
- Order Date
- 7 Aug 2025
- Effective From
- 7 Aug 2025
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank