The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 1 lakh on the Jaipur Central Co-operative Bank Ltd., Rajasthan, for non-compliance with regulatory directions related to Know Your Customer (KYC) norms. The penalty was levied through an order dated January 30, 2026, under the provisions of Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act.
The action followed a statutory inspection of the bank conducted by the National Bank for Agriculture and Rural Development (NABARD) with reference to its financial position as on March 31, 2025. Based on supervisory findings, RBI observed deficiencies in adherence to KYC guidelines and issued a show-cause notice to the bank.
After examining the bank’s written response and oral submissions during a personal hearing, RBI concluded that the bank had failed to establish a system for periodic review of risk categorisation of customer accounts, which is required to be conducted at least once every six months.
RBI clarified that the penalty is based on regulatory compliance shortcomings and does not affect the validity of transactions or agreements with customers. The action is without prejudice to any further measures that may be initiated by the regulator.
