RBI imposes monetary penalty on The Chiplun Urban Co-operative Bank Ltd., Chiplun, Maharashtra

Case Brief

RBI imposed a monetary penalty on The Chiplun Urban Co-operative Bank Ltd., Chiplun, Maharashtra, after a statutory inspection and related examination found non-compliance with RBI directions. The bank had sanctioned gold loans under the Bullet Repayment Scheme beyond the regulatory limit and levied penal charges for non-maintenance of minimum balance in savings accounts at a fixed rate rather than proportionate to the actual shortfall. RBI said the penalty was imposed under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, and clarified that the action was based on deficiencies in regulatory compliance and not intended to pronounce upon the validity of any transaction or agreement with customers.