The RBI has imposed a ₹5 lakh penalty on The Monghyr-Jamui Central Co-operative Bank Limited for non-compliance with KYC directions. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Monetary Penalty on Co-operative Bank for KYC Non-Compliance
The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹5 lakh on The Monghyr-Jamui Central Co-operative Bank Limited, Bihar, for failure to comply with regulatory directions on 'Know Your Customer' (KYC) norms. The order, dated September 25, 2026, was issued under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
This enforcement action reflects the RBI’s continued focus on ensuring adherence to anti-money laundering standards and customer due diligence by regulated entities. The penalty underscores the obligation of banks, including regional co-operative banks, to maintain robust KYC frameworks and update customer records in line with regulatory mandates.
For practitioners, this serves as a reminder that even smaller-sized banks are under active supervisory scrutiny. Non-compliance with KYC directives can attract financial penalties regardless of the bank’s scale. Legal advisors should ensure their clients in the co-operative banking sector conduct regular compliance audits and implement corrective measures promptly upon regulatory feedback.
Citations
- Banking Regulation Act, 1949, Sections 47A(1)(c), 46(4)(i), 56