1 hour ago
- copy link
Reserve Bank of India (RBI) has imposed a penalty of Rs 41.8 lakh on Canara Bank. This action has been taken for non-compliance of some important banking guidelines including Know Your Customer (KYC) rules.
RBI investigation has revealed that Canara Bank did not upload the KYC records of many customers on the Central KYC Records Registry (CKYCR) within the stipulated time limit.
According to the rules, all banks have to update the KYC data of new and existing customers on this central registry within the stipulated time, so that fraud can be prevented. Canara Bank failed to follow this timeline.
Accounts put in ‘inoperative’ category despite transactions taking place
The second case of violation of rules is related to the handling of customer accounts. RBI guidelines say that if any transaction has taken place in an account by the customer within the last one year, then it will be considered active. However, Canara Bank had also declared many such accounts inoperative (inactive), in which not even a year had passed since the last transaction.
Flaws revealed in the assessment of financial position for March 2025
RBI has taken this action of the bank under a supervisory evaluation (ISE 2025). For this, the financial position and working of Canara Bank till 31 March 2025 was audited.
After the deficiencies found during the investigation, RBI had issued a ‘show cause notice’ to the bank. After considering the response received from the bank and oral submissions, the central bank decided to impose the penalty.
The action will not affect customers
RBI has clarified that this penalty has been imposed only due to deficiencies in regulatory compliance. The purpose of this action is not to question the validity of any transaction or agreement entered into between the bank and its customers. This will not have any impact on the normal functioning of the bank and the deposits of customers.
Source link
[ad_3]
