RBI imposes monetary penalty on Pragati Mahila Nagrik Sahakari Bank Maryadit, Bhilai (C.G)

Case Brief

By an order dated June 16, 2022, RBI imposed a monetary penalty of ₹2 lakh on Pragati Mahila Nagrik Sahakari Bank Maryadit, Bhilai, Chhattisgarh. The penalty was for contravention of RBI directions to urban co-operative banks relating to loans and advances to directors' relatives as guarantors/sureties and for non-compliance with KYC periodic updation requirements. RBI cited deficiencies in regulatory compliance under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, and noted that the action was based on compliance failures rather than the validity of customer transactions.