The Reserve Bank of India (RBI) has levied monetary penalties totaling Rs. 2.206 crore on five leading Indian banks for various lapses in regulatory compliance. The banks penalized include ICICI Bank, Axis Bank, IDBI Bank, Bank of Maharashtra, and Bank of Baroda. The fines were imposed after the central bank identified violations of its guidelines and standards.
Axis Bank Fined Rs. 29.60 Lakh for Irregular Internal Account Transactions
Axis Bank has been penalized with a monetary fine of Rs. 29.60 lakh. According to the RBI, the bank routed unauthorized or unrelated transactions through specific internal or office accounts, breaching regulatory norms.
ICICI Bank Faces Rs. 97.80 Lakh Penalty for Cybersecurity and Customer Service Lapses
ICICI Bank received the highest penalty of Rs. 97.80 lakh. The RBI cited multiple issues including failure to report a cybersecurity incident within the mandated timeframe. Additionally, the bank lacked a robust alert system for certain accounts, failed to issue timely credit card statements, and wrongly charged customers late payment fees.
Bank of Maharashtra and IDBI Bank Fined Rs. 31.80 Lakh for KYC and Lending Norm Violation
A joint penalty of Rs. 31.80 lakh has been imposed on Bank of Maharashtra and IDBI Bank. The RBI observed that Bank of Maharashtra opened certain deposit accounts using Aadhaar-based OTP verification without in-person customer verification, violating KYC norms. IDBI Bank, on the other hand, overcharged interest on certain Kisan Credit Card (KCC) accounts beyond the permitted rate.
Bank of Baroda Penalized Rs. 61.40 Lakh for Insurance Sales and Account Handling Lapses
Bank of Baroda was fined Rs. 61.40 lakh for failing to prevent an insurance company from offering non-cash incentives to bank staff for insurance product sales. Moreover, the bank did not regularly credit interest to dormant or frozen savings accounts, as required by RBI guidelines.
RBI Clarifies Nature of Penalties
The RBI clarified that these penalties are purely for non-compliance with regulatory directions and do not affect any customer transactions or contractual obligations with the respective banks.