RBI Cracks Down: Heavy Penalties on Major Banks

The Reserve Bank of India has imposed significant monetary penalties on Union Bank of India, Bank of India, Central Bank of India, and Pine Labs for violations of regulatory directions. Infractions included failures in customer transactions, KYC record keeping, and incorrect service charges. These fines highlight continued regulatory enforcement in the banking sector.

The Reserve Bank of India (RBI) has levied substantial financial penalties on several notable banking institutions, including Union Bank of India, Bank of India, and Central Bank of India, as well as financial services provider Pine Labs. The penalties are a result of non-compliance with specific regulatory directions, according to a statement released by the RBI.

The Union Bank of India received a penalty of Rs 95.40 lakh for failing to credit amounts from unauthorized electronic transactions back into customers' accounts within the required period. The institution was also criticized for not offering 24/7 customer access to report unauthorized transactions and engaging in manual asset classification interventions.

Central Bank of India faced a Rs 63.60 lakh penalty due to its failure to adhere to KYC record timelines and opening multiple Basic Savings Bank Deposit accounts. Similarly, the Bank of India was penalized Rs 58.50 lakh for incorrect service charges and interest payment issues. Pine Labs was fined Rs 3.10 lakh related to KYC shortcomings for prepaid payment instruments.

(With inputs from agencies.)