RBI hits heavy penalty on Kotak Mahindra & IndusInd Bank

India's central banks hit the penalty on banks for contravention of the provisions of the Banking Regulation Act, 1949.

RBI hits heavy penalty on Kotak Mahindra & IndusInd Bank
RBI hits heavy penalty on Kotak Mahindra & IndusInd Bank

New Delhi: The Reserve Bank of India (RBI) on Monday imposed a heavy penalty on Kotak Mahindra Bank Limited and IndusInd Bank Ltd of Rs. 1.05 crore and Rs 1 crore respectively. 

India's central banks hit the penalty on Kotak Mahindra limited for contravention of the provisions of the Banking Regulation Act, 1949, ‘The Depositor Education and Awareness Fund Scheme, 2014’ and for non-compliance with the directions on ‘Customer Protection – Limiting Liability of Customers in Unauthorised Electronic Banking Transactions’, and ‘Loans and Advances – Statutory and Other Restrictions. 

Accordingly, on IndusInd Bank Ltd the penalty was imposed due to the non-compliance with certain directions issued by RBI on ‘Reserve Bank of India (Know Your Customer (KYC)) Directions, 2016’.

This action is based on the deficiencies 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.