Recorded RBI impact
Fine: Rs 50,000
Monetary penalty · Fresh imposition
Published by RBI
23 Mar 2026
Case Brief
RBI, by an order dated March 17, 2026, imposed a monetary penalty of ₹50,000 on The Pali District Central Co-operative Bank Ltd., Rajasthan. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act after NABARD’s statutory inspection and subsequent supervisory proceedings found non-compliance with RBI directions on Know Your Customer (KYC). The sustained violation was the bank’s failure to put in place a system for periodic review of the risk categorisation of accounts at least once in six months.
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 after a supervisory inspection found non-compliance with RBI directions on Know Your Customer (KYC). The sustained charge was that the bank had not established a system for periodic review of risk categorisation of accounts with the required six-monthly periodicity.
Operating Impact
The bank must absorb the penalty and address the KYC control gap identified by RBI. The order does not itself impose a business restriction, but the bank remains exposed to further supervisory or enforcement action if similar non-compliance continues.
Regulatory Basis
- Section 47A(1)(c)
- Sections 46(4)(i) and 56 of the Banking Regulation Act
Action Facts
- Primary Impact
- Fine: Rs 50,000
- Order Date
- 17 Mar 2026
- Effective From
- 17 Mar 2026
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank