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The Pij People’s Co-operative Bank Ltd

Co-operative bankKheda, Gujarat

The RBI action, regulatory basis, and operating impact linked to this entity.

Recorded RBI impact

Fine: Rs 4.00 L

Monetary penalty · Fresh imposition

S2

Published by RBI

20 Apr 2018

Case Brief

The Reserve Bank of India imposed a monetary penalty on The Pij People’s Co-operative Bank Ltd., Dist. Kheda, Gujarat (a non-scheduled urban co-operative bank), under Section 47A(1) read with Section 46(4) of the Banking Regulation Act, 1949 as applicable to co-operative societies. RBI said the bank violated instructions under the Supervisory Action Framework and KYC/AML guidelines by not allotting Unique Customer Identification Codes (UCIC) to customers, not having a system to generate alerts for transactions inconsistent with customer risk categorisation and profile, and not maintaining/reporting records of cash transactions above ₹10 lakh to FIU-IND. After a show-cause notice, written reply, and personal submission before RBI’s Committee of Senior Officers, RBI concluded the violations were substantiated and imposed a penalty of ₹4 lakh.

Why RBI Acted

KYC / AMLReporting & disclosureCustomer protection

RBI imposed a monetary penalty under Section 47A(1) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies) after finding that the bank violated RBI instructions issued under the Supervisory Action Framework (SAF). The violations included not allotting Unique Customer Identification Codes (UCIC) to customers, not putting in place a system to generate alerts when transactions were inconsistent with risk categorisation and customer profile, and not maintaining records of cash transactions above ₹10 lakh or reporting them to FIU-IND, as required under KYC and AML guidelines. RBI issued a show-cause notice, considered the bank's written reply and personal submission, and concluded the violations were substantiated.

Operating Impact

The bank must bear the penalty and should address the cited compliance gaps in UCIC allocation, transaction monitoring, and cash-transaction recordkeeping/reporting. The action does not itself impose a business restriction, but it signals heightened supervisory concern over KYC/AML compliance.

Regulatory Basis

  • Section 47A (1) read with Section 46(4) of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies)

Action Facts

Primary Impact
Fine: Rs 4.00 L
Entities Affected
1
Entity Role
Primary
Entity Type
Co-operative bank