The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 15 lakh on Bharat Co-operative Bank (Mumbai) Limited for non-compliance with its directions on interest rates applicable to deposits. The penalty was levied through an order dated February 6, 2026, under provisions of the Banking Regulation Act, 1949.
The action followed a statutory inspection of the bank conducted with reference to its financial position as on March 31, 2025. Based on supervisory findings, RBI issued a show-cause notice to the bank for failure to comply with prescribed norms. After examining the bank’s written reply and oral submissions during a personal hearing, the regulator concluded that the bank had not paid interest on certain eligible term deposits that were withdrawn prematurely.
RBI clarified that the penalty relates solely to regulatory deficiencies and does not affect the validity of transactions with customers, nor does it preclude further action.