RBI imposes monetary penalty on The Shirpur Peoples’ Co-operative Bank Ltd., Shirpur (Maharashtra)

Case Brief

By order dated January 04, 2023, RBI imposed a monetary penalty of ₹3.00 lakh on The Shirpur Peoples’ Co-operative Bank Ltd., Shirpur (Maharashtra). The penalty was imposed under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, after RBI found that the bank had sanctioned advances to a group of borrowers above the permissible limit, failed to comply with Income Recognition and Asset Classification (IRAC) norms, and did not have robust software to identify and monitor suspicious transactions. RBI stated that the action was based on deficiencies in regulatory compliance and was not intended to pronounce on the validity of any transaction or agreement with customers.