The Reserve Bank of India, which oversees the banking sector, has chosen to apply a money fine to three major public sector banks.
These banks are State Bank of India, Indian Bank, and Punjab and Sindh Bank.
RBI has decided on this fine because these banks broke the rules about knowing their customers and preventing money laundering when they opened current accounts.
RBI Fines State Bank of India
On September 21, 2023, the RBI (Reserve Bank of India) has applied a fine of Rs 1.30 crore to the State Bank of India.
This penalty is because the bank did not follow the guidelines from the Central Bank about loans and advances.
The RBI chose to give this penalty using its authority. The RBI examined the bank’s financial situation on March 31, 2021.
They discovered several problems in the risk assessment report, so they sent a notice to the bank.
Penalty on Indian Bank
The RBI (Reserve Bank of India) has given a penalty of Rs 1.62 crore to Indian Bank.
This happened because the bank did not follow the KYC (Know Your Customer) rules and did not follow the instructions from the RBI regarding deposits.
This penalty was imposed after the bank provided additional information during a personal hearing following an initial reply.
The RBI was not satisfied with the bank’s response, so they decided to impose the penalty.
RBI Fines Punjab and Sindh Bank
The RBI (Reserve Bank of India) has given a fine of Rs 1 crore to Punjab and Sindh Bank.
This fine was imposed because the bank did not follow the rules of the Banking Regulation Act related to the Depositor Education and Awareness Fund Scheme.
The RBI examined the bank’s financial situation on March 31, 2021, and found that the bank didn’t deposit the money within the required time frame for the Depositor Education and Awareness Fund Scheme.
As a result, the RBI decided to apply this penalty.