RBI Imposes ₹38.60 Lakh Penalty on UCO Bank
Moneylife Digital Team 23 February 2026
Reserve Bank of India (RBI) has imposed a penalty of ₹38.60 lakh on UCO Bank for non-compliance with certain regulatory directions. The violations relate to the periodicity of payment of interest on savings deposits, the collection of locker rent and deficiencies in credit information reporting concerning members of self-help groups (SHGs).
 
The statutory inspection of UCO Bank revealed several compliance lapses. The lender failed to pay interest on certain savings bank deposit accounts. It also did not report credit-related, member-level data of SHGs to credit information companies (CIC). 
 
Additionally, in cases of premature surrender of lockers by some customers, UCO Bank did not refund the proportionate amount of advance locker rent collected.
 
After considering the lender’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI says the charges against UCO Bank are sustained, warranting the imposition of a monetary penalty.
 
However, the banking regulator clarified that its action against UCO 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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