RBI imposes nearly Rs 6200000 penalty on this bank worth Rs 4.29 lakh crore for…
RBI said the bank found that certain customers who already had a basic savings bank deposit (BSBD) account with the bank had opened another BSBD account.
News from RBI: The Reserve Bank of India (RBI) has imposed a penalty of Rs 61.95 lakh on Kotak Mahindra Bank for non-compliance with certain instructions issued by it regarding access to banking services, basic savings bank deposit accounts, scope of activities to be undertaken by business correspondents (BCs) and violation of provisions of the Credit Information Companies Rules, 2006 (ClC Rules).
“This penalty has been imposed in exercise of the powers conferred on the RBI under the provisions of section 47A(1)(c) read with section 46(4)(i) of the BR Act and section 25(1)(iii) read with section 23(4) of the Credit Information Companies (Regulation) Act, 2005,” the central bank said in a statement. he said.
The regulatory review for the bank’s supervisory assessment (ISE 2024) was conducted by the RBI with reference to its financial position as on March 31, 2024. “Based on the audit findings of non-compliance with the provisions of the RBI instructions, CIC rules and correspondence in this regard, a notice was issued advising the bank to show cause as to why a penalty should not be imposed on it for non-compliance with the said provisions of the RBI instructions and CIC rules,” the RBI stated.
After considering the bank’s response to the notice and additional applications filed by the bank, the RBI said it found that the bank had opened another BSBD account of certain customers who already had a basic savings bank deposit account (BSBD) account with the bank.
In addition, the bank has reached an agreement with BCs to undertake activities that are not within the scope of activities that BCs can undertake. Moreover, according to the RBI, the bank provided false information to Credit Information Companies (CICs) regarding certain borrowers. The RBI clarified that this action was based on deficiencies in legal and regulatory compliance and was not intended to affect the validity of any transaction or agreement the bank had with its customers. “Furthermore, the imposition of the fine shall be without prejudice to any other proceedings which the RBI may initiate against the bank,” the RBI said.
