The Reserve Bank of India (RBI) has shown strictness in showing laxity in following the rules. Therefore, a fine of Rs 1.3 crore has been imposed on the country's largest bank SBI. Apart from this, a fine of crores of rupees has also been imposed on two more government banks - Indian Bank and Punjab and Sindh Bank.
A statement has been issued by RBI regarding this. Accordingly, RBI has prepared a manual on statutory and other restrictions regarding 'loans and advances' and has also issued guidelines for the management of intra-group transactions. SBI has failed to follow both these rules properly, due to which a fine of Rs 1.3 crore has been imposed on it.
Indian Bank and Punjab and Sindh Bank also fined crores of rupees
In a separate statement, RBI has informed about imposing a fine of Rs 1.62 crore on Indian Bank for violating 'Loan and Advance Loan' rules, KYC related rules and RBI guidelines regarding interest rate on deposits. Apart from this, a fine of Rs 1 crore has been imposed on Punjab and Sindh Bank for not following the provisions related to Depositor Education and Awareness Fund Scheme.
The central bank has also imposed a fine of Rs 8.80 lakh on Fedbank Financial Services Limited, a company in the NBFC sector. This fine has been imposed on the company for not following some provisions related to preventing fraud.
License of this bank canceled
RBI has also informed about canceling the license of 'The Kapol Co-operative Bank Limited' of Mumbai. This decision has been taken due to the bank not having sufficient capital and there is no hope of earning. However, RBI has made it clear that customers will not suffer much loss due to this, because 96.09 percent of the bank's customers will get their entire money back. In India, thanks to the Deposit Insurance and Credit Guarantee Corporation, people get insurance cover on bank deposits up to Rs 5 lakh.
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