RBI fines Karnal Central Cooperative Bank Rs 3 lakh for KYC lapses
The penalty follows NABARD inspection findings of failures in risk categorisation and suspicious transaction reporting.
What changed
- Failed to set up periodic review of risk categorisation of accounts
- Failed to put in place software for identification and reporting of suspicious transactions
The read
RBI imposed a monetary penalty of ₹3 lakh on The Karnal Central Cooperative Bank Limited for non-compliance with KYC directions. The statutory inspection by NABARD as of March 31, 2025 revealed that the bank lacked a system for periodic review of risk categorisation and software for identifying and reporting suspicious transactions. RBI found these violations sustained after considering the bank's reply and personal hearing. The penalty is on regulatory compliance deficiencies, not on the validity of customer transactions. This action signals RBI's strict monitoring of cooperative banks' KYC adherence.
Key numbers
- Penalty: ₹3 lakh
- Inspection date: March 31, 2025
- Order date: June 3, 2026
Primary source: rbi.org.in