Recorded RBI impact
Fine: Rs 50,000
Monetary penalty · Fresh imposition
Published by RBI
12 Mar 2026
Case Brief
By an order dated March 11, 2026, RBI imposed a monetary penalty of ₹50,000 on Walchandnagar Sahakari Bank Ltd., Walchandnagar, Maharashtra under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949. The penalty followed a statutory inspection and supervisory findings that the bank had not complied with RBI directions on KYC. Specifically, RBI found that the bank failed to put in place a system for periodic review of the risk categorisation of accounts, with the review required at least once in six months. RBI noted that the action was based on regulatory compliance deficiencies and did not pronounce on the validity of any customer transaction or agreement.
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, 1949 after supervisory findings showed non-compliance with RBI's Know Your Customer (KYC) directions. The sustained charge was that the bank failed to establish a system for periodic review of the risk categorisation of accounts, with review frequency of at least once every six months.
Operating Impact
The bank must absorb the penalty and strengthen its KYC control framework, especially the periodic review of account risk categorisation. No customer-facing restriction is imposed by this order, but RBI may initiate further action if it deems necessary.
Regulatory Basis
- Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 50,000
- Order Date
- 11 Mar 2026
- Effective From
- 11 Mar 2026
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank