The Reserve Bank of India (RBI) has imposed monetary penalties on four cooperative banks for failing to comply with regulatory directions. The action has been taken under provisions of the Banking Regulation Act, 1949 and other RBI guidelines.
The RBI, through orders dated August 19 and August 22, 2025, levied a penalty of Rs 1 lakh on The Purasawalkam Cooperative Bank Limited, Tamil Nadu. The central bank said the penalty was imposed for non-compliance with directions on Prudential Norms on Capital Adequacy – Urban Cooperative Banks (UCBs) and the Supervisory Action Framework (SAF).
Another penalty of Rs 1 lakh was imposed on The Vijayapura District Central Cooperative Bank Ltd., Karnataka for contravention of provisions under Section 20 read with Section 56 of the Banking Regulation Act, 1949.
Similarly, The Ponani Cooperative Urban Bank Limited, Kerala was fined Rs 50,000 for non-compliance with RBI’s directions on Interest Rate on Deposits.
In addition, The Nanded District Central Cooperative Bank Ltd., Maharashtra faced a penalty of Rs 45,000 for violations of Know Your Customer (KYC) norms and non-compliance with the requirement of Membership of Credit Information Companies (CICs).
The RBI clarified that the penalties were imposed for regulatory deficiencies and do not affect the validity of transactions or agreements entered into by the banks with their customers. The action underscores RBI’s continued focus on strengthening compliance and governance standards in the cooperative banking sector.
