RBI Imposes ₹14.25 lakh Penalty on Nagar Sahkari Bank from Maharajganj
Moneylife Digital Team 04 June 2026
Reserve Bank of India (RBI) has imposed a penalty of ₹14.25 lakh on Maharajganj, Uttar Pradesh-based Nagar Sahkari Bank Ltd for non-compliance with RBI directions relating to income recognition, asset classification and provisioning norms. The violations also pertained to exposure norms, statutory and other regulatory restrictions, membership of credit information companies (CICs) and the management of advances.
 
RBI's statutory inspection of Nagar Sahkari Bank found several regulatory lapses. The lender failed to classify certain borrower accounts as non-performing assets (NPAs), incorrectly classified some existing NPAs and did not identify NPAs on a continuous basis. 
 
Further, Nagar Sahkari Bank also breached the prescribed regulatory limits on unsecured advances at both the individual borrower and aggregate levels. In addition, the lender failed to upload the borrower's credit information to CICs and did not take adequate precautions to prevent deficiencies in certain loan sanctions.
 
After considering Nagar Sahkari Bank's reply to the notice, oral submissions made during the personal hearing, and the additional submissions made by it, RBI says the charges against the lender are sustained and warrant the imposition of a monetary penalty.
 
However, the banking regulator clarified that its action against Nagar Sahkari Bank is based on regulatory compliance deficiencies and is not intended to pronounce on the validity of any transactions or agreements entered into by the Bank with its customers. Further, imposition of a monetary penalty is without prejudice to any other action that may be initiated against the Bank, RBI added.
 
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