New Delhi [India], January 29 : The Reserve Bank of India (RBI) has, by an order dated January 8, 2024, imposed a penalty of Rs 50,000 on Bhilai Nagrik Sahakari Bank Maryadit, Bhilai, Chhattisgarh (the bank) for non-compliance with the directions issued by RBI on 'Know Your Customer (KYC) Direction, 2016'.
This penalty has been imposed in the exercise of powers conferred on RBI under the provisions of Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, the RBI said in a release on Monday.
"This action is based on the deficiency in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers," the release added.
The statutory inspection of the bank conducted by the RBI with reference to its financial position as of March 31, 2022, revealed, inter alia, that the bank had failed to carry out periodic updation of KYC for its customers at the prescribed periodic intervals. Consequently, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for failure to comply with the said directions, as stated therein, RBI said.
After considering the bank's reply to the notice and additional submissions made by it, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty on the bank, it added.
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