Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
25 Jul 2022
Case Brief
RBI imposed a monetary penalty on The United Puri-Nimapara Central Co-operative Bank Ltd., Puri, Odisha, by order dated July 21, 2022. The penalty was levied for contravention/non-compliance with RBI directions on KYC after an inspection found that the bank did not undertake risk categorisation of customers and did not periodically update customers' KYC profiles. The penalty was imposed under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949.
Why RBI Acted
An inspection based on the bank's financial position as on March 31, 2019 found violation/non-compliance with RBI directions on Know Your Customer (KYC). Specifically, the bank failed to undertake risk categorisation of customers and to update customers' KYC profiles periodically. After a show-cause notice and consideration of the bank's reply and additional submissions, RBI concluded that the contraventions were substantiated and imposed a monetary penalty under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must absorb the penalty and address the cited KYC compliance weaknesses going forward. The release does not describe any operating restriction, but it signals heightened supervisory scrutiny over customer due diligence and ongoing KYC maintenance.
Regulatory Basis
- Section 47 A (1) (c) read with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Order Date
- 21 Jul 2022
- Effective From
- 21 Jul 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank