The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹3 lakh on Ambarnath Jai Hind Co-operative Bank Limited, Ambarnath, Maharashtra, for non-compliance with certain provisions of RBI directions on ‘Maintenance of Deposit Accounts – Primary (Urban) Co-operative Banks’.
The penalty was imposed based on the findings of a statutory inspection conducted by RBI with reference to the bank’s financial position as on March 31, 2023. The inspection revealed that the bank had:
- Collected fixed penal charges for shortfall in the maintenance of minimum balance in savings bank accounts without giving one month notice to customers regarding minimum balance requirement.
- Collected penal charges for non-maintenance of minimum balance in inoperative accounts.
- Charged for the activation of inoperative accounts.
These actions are in violation of RBI’s directions on ‘Maintenance of Deposit Accounts – Primary (Urban) Co-operative Banks’.
The RBI has clarified that this action is based on the 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.
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This is not the first time that RBI has imposed a penalty on a cooperative bank for non-compliance with its directions. In recent months, RBI has imposed penalties on several other cooperative banks for similar violations.
This highlights the importance of cooperative banks adhering to RBI’s directions and maintaining high standards of corporate governance.
Source: Reserve Bank of India – Press Releases