Uttar Pradesh Co-operative Bank Limited, Lucknow

Following NABARD’s statutory inspection with reference to the bank’s position as on March 31, 2020, RBI found that Uttar Pradesh Co-operative Bank Limited, Lucknow did not comply with the RBI (Know Your Customer) Directions, 2016 and RBI directions on Customer Service in State/District Central Co-operative Banks. The deficiencies cited included failure to deploy robust software for effective identification and reporting of suspicious transactions and levying penal charges for non-maintenance of minimum balances in inoperative accounts during FY 2019-20. RBI concluded the contraventions were substantiated and imposed a monetary penalty under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.

The bank must absorb the financial penalty and ensure future compliance with RBI KYC and customer-service requirements. The order does not by itself invalidate customer transactions, but it signals regulatory scrutiny over suspicious-transaction monitoring and charges levied on inoperative accounts.