Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
30 Oct 2023
Case Brief
By an order dated October 04, 2023, RBI imposed a monetary penalty of ₹2.00 lakh on Pij People’s Co-operative Bank Limited, Pij, Dist. Kheda, Gujarat. The penalty was imposed under Section 47-A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 for non-compliance with RBI’s Know Your Customer (KYC) Directions, 2016. A statutory inspection found that the bank had failed to carry out periodic review of risk categorisation of accounts. After issuing a show-cause notice and considering the bank’s reply and oral submissions, RBI concluded that the contravention was substantiated.
Why RBI Acted
RBI imposed a monetary penalty under Section 47-A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after a statutory inspection found that the bank had not carried out the periodic review of risk categorisation of accounts, contrary to RBI’s Know Your Customer (KYC) Directions, 2016. RBI said the charge was substantiated after considering the bank’s reply and oral submissions.
Operating Impact
The bank must bear the penalty; the release does not announce any additional restriction on operations, deposits, or lending. The finding signals compliance deficiencies under KYC controls and may increase supervisory scrutiny, but no direct forward-looking business ban is imposed by this order.
Regulatory Basis
- Section 47-A (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
- 4 Oct 2023
- Effective From
- 4 Oct 2023
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank