FCC Flash

The Reserve Bank of India (RBI) has imposed a US$0.19 million penalty on ‘Indian Bank’ for non-compliance with RBI’s directions related to loans, KYC, and interest rates. The penalty arises from the bank’s deficiencies in regulatory compliance and is not a judgment on the validity of transactions with customers.

To read in detail, click here https://www.fcctimes.com/2023/09/25/rbi-imposes-%e2%82%b91-62-crore-penalty-on-indian-bank-for-regulatory-non-compliance/


  • The RBI conducted a Statutory Inspection for Supervisory Evaluation (ISE 2021) of Indian Bank based on its financial position as of March 31, 2021.
  • The inspection revealed non-compliance with RBI directions, including:
    Sanctioning a term loan to a corporation without conducting due diligence on project viability and funding sources.
    Allowing open accounts through OTP-based e-KYC without performing customer due diligence.
    Opening savings accounts for customers not eligible for such accounts.
  • The RBI issued a notice to the bank, which responded and presented oral submissions during a hearing.
  • After evaluating the bank’s response, the RBI concluded that non-compliance had been established, warranting the monetary penalty.