RBI imposes monetary penalty on Bank of Baroda

Case Brief

RBI, by order dated April 29, 2025, imposed a monetary penalty of ₹61.40 lakh on Bank of Baroda. The penalty was issued under Section 47A(1)(c) read with Sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949, after the bank's statutory Inspection for Supervisory Evaluation (ISE 2023) identified non-compliance with RBI directions on 'Financial Services provided by Banks', 'Customer Service in Banks' and 'Interest Rate on Deposits'. RBI said the sustained charges included failure to ensure that no non-cash incentive was paid to staff engaged in insurance corporate agency service by an insurance company, and failure to credit interest in certain inoperative/dormant/frozen savings deposit accounts at the prescribed intervals.