The Reserve Bank of India has imposed a monetary penalty of Rs 26.00 lakh on Nutan Nagarik Sahakari Bank Ltd., Ahmedabad. The UCB was fined for non-compliance with the directions issued by RBI on ‘Co-operative Bank-Interest rate on deposits’ and ‘Guidelines for issue of ATM-cum-Debit cards by UCBs’.
This action is based on deficiency in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers, says RBI.
The statutory inspection of the bank conducted by RBI with reference to its financial position as on March 31, 2020, and examination of the Risk Assessment Report and all related correspondence pertaining to the same, revealed, inter alia, that the bank (i) failed to pay interest at the rate applicable to saving deposits on certain overdue recurring and fixed deposit accounts at the time of their repayment and (ii) had issued ATM-cum-Debit cards to certain cash credit account holders.
In furtherance to the same, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed for non-compliance with the RBI directions, as stated therein.
