This action is based on deficiencies in regulatory compliance
FinTech BizNews Service
Mumbai, July 2, 2026: The Reserve Bank of India (RBl) has imposed a monetary penalty each on 3 cooperative banks.
RBI imposes monetary penalty on Nirmal Urban Co-operative Bank Ltd., Nagpur, Maharashtra
The Reserve Bank of India (RBl) has, by an order dated June 30, 2026, imposed a monetary penalty of Rs1 lakh (Rupees One Lakh only) on Nirmal Urban Co-operative Bank Ltd., Nagpur, Maharashtra (the bank) for non-compliance with certain directions issued by RBI on ‘Limits on exposure to single and group borrowers/parties and large exposures and Revision in the target for priority sector lending – UCBs’ and operational instructions issued under ‘Supervisory Action Framework (SAF)’. This penalty has been imposed in 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 statutory inspection of the bank was conducted by RBI with reference to its financial position as on March 31, 2025. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions. After considering the bank's reply to the notice, additional submissions made by it and oral submissions made during the personal hearing, RBI found, inter alia, that the following charges against the bank were sustained, warranting imposition of monetary penalty:
In non-adherence to the directions under Supervisory Action Framework (SAF), the bank had:
not reduced, single borrower exposure limit for fresh loans and advances by 50% of the applicable regulatory limit, in certain cases; and offered interest rates on certain deposits, higher than those offered by the State Bank of India.
This action is based on deficiencies 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. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.
2 RBI imposes monetary penalty on The N.E. & E.C. Railway Employees’ Multi-State Primary Co-operative Bank Ltd, Gorakhpur
The Reserve Bank of India (RBI) has, by an order dated June 30, 2026, imposed a monetary penalty of Rs1.05 lakh (Rupees One Lakh Five Thousand only) on The N.E. & E.C. Railway Employees’ Multi-State Primary Co-operative Bank Ltd, Gorakhpur (the bank) for contravention of the provisions of Section 26A read with Section 56 of the Banking Regulation Act, 1949 (BR Act) and non-compliance with certain directions issued by RBI on ‘Membership of Credit Information Companies (CICs) by Co-operative Banks’. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the BR Act and Section 25 read with Section 23 of Credit Information Companies (Regulation) Act, 2005.
The statutory inspection of the bank was conducted by RBI with reference to its financial position as on March 31, 2025. Based on supervisory findings of contravention of statutory provisions / non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said provisions and directions. After considering the bank’s reply to the notice and additional submissions made by it, RBI found, inter alia, that the following charges against the bank were sustained, warranting imposition of monetary penalty:
The bank had failed to:
transfer eligible unclaimed amounts to the Depositor Education and Awareness Fund within the prescribed period; and obtain membership of two Credit Information Companies (CICs) and submit credit information of its borrowers to all the four CICs.
This action is based on deficiencies in statutory and regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.
3 RBI imposes monetary penalty on Dharmavir Sambhaji Urban Cooperative Bank Ltd., Pune, Maharashtra
The Reserve Bank of India (RBI) has, by an order dated June 29, 2026, imposed a monetary penalty of Rs10,000/- (Rupees Ten Thousand only) on Dharmavir Sambhaji Urban Cooperative Bank Ltd., Pune, Maharashtra (the bank) for non-compliance with certain directions issued by RBI on ‘Know Your Customer (KYC)’. This penalty has been imposed in 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 statutory inspection of the bank was conducted by RBI with reference to its financial position as on March 31, 2025. Based on supervisory findings of non-compliance with RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said directions. After considering the bank’s reply to the notice and oral submissions made during the personal hearing, RBI found, inter alia, that the following charge against the bank was sustained, warranting imposition of monetary penalty:
The bank had failed to upload the KYC records of customers onto Central KYC Records Registry (CKYCR) within the prescribed timeline.
This action is based on deficiencies 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. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.
