RBI Slaps Rs1.91 Crore Penalty on Axis Bank for Violating KYC Norms and Improper Loan Practices
Moneylife Digital Team 11 September 2024
The Reserve Bank of India (RBI) has imposed a penalty of Rs1.91 crore on Axis Bank Ltd for contravention of provisions of section 19 (1) (a) of the Banking Regulation Act (BR Act) and non-compliance with directions on the interest rate on deposits, know-your-customer (KYC) norms and credit flow to collateral free agricultural loans.
 
In a release, RBI says that the penalty was imposed after identifying that Axis Bank had opened certain savings accounts in the name of ineligible entities. Additionally, multiple customer identification codes were allotted to certain customers, rather than assigning a unique customer identification code (UCIC) for each customer, as required. 
 
Furthermore, Axis Bank had obtained collateral security for agricultural loans up to Rs1.60 lakh in certain cases, which is against the norms. 
 
Also, a wholly-owned subsidiary of Axis Bank was found to be engaged in the business of providing technology services, a business activity that is not permitted for a banking company under Section 6 of the BR Act.
 
After considering the facts of the case and the Bank’s reply, RBI concluded that the violations were substantiated and warranted the imposition of a penalty.
 
This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.
 
Comments
SC Sets Aside Rs80 Lakh Penalty on SEBI, BSE & NSE, Asks Bombay HC To Rehear Demat Account Freezing Case
Moneylife Digital Team 10 September 2024
After finding procedural errors, the Supreme Court set aside the Rs80 lakh penalty imposed by the Bombay High Court (HC) on Securities and Exchange Board of India (SEBI), Bombay Stock Exchange Ltd (BSE) and National Stock Exchange Ltd...
HDFC Bank Slapped with Rs1 Crore Penalty for Non-compliance with Deposit and Customer Service Guidelines
Moneylife Digital Team 10 September 2024
The Reserve Bank of India (RBI) has imposed a penalty of Rs1 crore on HDFC Bank Ltd for failing to follow guidelines on interest rates on deposits, the use of recovery agents, customer service standards in banks and the management of...
RBI Imposes Rs10.50 Lakh Penalty on 4 Cooperative Banks
Moneylife Digital Team 10 September 2024
Reserve Bank of India (RBI) has imposed a penalty of Rs10.50 lakh on four cooperative banks for non-compliance with the directions issued by the banking regulator. The highest penalty of Rs4.50 lakh has been imposed on Samarth...
Congress Levels Fresh Conflict of Interest Charges against SEBI Chairperson, Wockhardt Denies Allegations of Rent Payment
Moneylife Digital Team 09 September 2024
Levelling more conflict of interest allegations against Madhabi Puri Buch, the chairperson of the Securities and Exchange Board of India (SEBI), the Congress claimed that she received rental income from Carol Info Services Ltd, a...
Array
Free Helpline
Legal Credit
Feedback