Recorded RBI impact
Fine: Rs 5.00 L
Monetary penalty · Fresh imposition
Published by RBI
3 Aug 2016
Case Brief
The Reserve Bank of India has imposed a monetary penalty on Zila Sahakari Kendriya Bank Maryadit, Raipur under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). The penalty was imposed because the bank violated RBI directives/guidelines on Know Your Customer (KYC) norms. RBI issued a show-cause notice, considered the bank’s written reply, and concluded that the violations were substantiated and deserved penalty.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies) after finding that the bank had violated RBI directives/guidelines on Know Your Customer norms. The bank received a show-cause notice, submitted a written reply, and RBI concluded that the violations were substantiated and warranted penalty.
Operating Impact
The bank must pay the ₹5 lakh penalty; the release does not mention any additional restriction on operations, but it reflects RBI’s finding of KYC compliance lapses. The immediate impact is financial and reputational rather than operational.
Regulatory Basis
- Section 47A(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies)
Action Facts
- Primary Impact
- Fine: Rs 5.00 L
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank