RBI Slaps Rs7.30 Lakh Penalty on 2 Cooperative Banks from Gujarat, 2 from Maharashtra
Moneylife Digital Team 18 July 2025
Reserve Bank of India (RBI) has imposed a penalty of Rs7.30 lakh on four cooperative banks, two from Gujarat and two from Maharashtra for non-compliance with the directions issued by the banking regulator. The highest penalty of Rs3 lakh has been levied on Gujarat-based Sarvodaya Nagrik Sahakari Bank Ltd.
 
Other banks penalised by RBI are Gujarat-based Mandvi Nagrik Sahakari Bank Ltd and Maharashtra-based Thane District Central Cooperative (DCC) Bank Ltd and Laxmi Vishnu Sahakari Bank Ltd.
 
Sarvodaya Nagrik Sahakari Bank was penalised for failing to comply with the RBI's guidelines on the comprehensive cybersecurity framework for primary urban cooperative banks (UCBs), as part of its graded approach. The lender also violated directions related to the standard turnaround time (TAT) and customer compensation for failed transactions made through authorised payment systems.
 
RBI’s statutory inspection of Sarvodaya Nagrik Sahakari Bank found that the lender had failed to conduct vulnerability assessments (VA) and penetration testing (PT) of its internet-facing mobile application within the required timeframes. Additionally, the Bank did not provide compensation for certain failed IMPS and UPI transactions that were not auto-reversed within the prescribed timeline.
 
Mandvi Nagrik Sahakari Bank, located in Surat, has been penalised Rs2 lakh for non-compliance with directions issued by the RBI on management of advances for UCBs.The lender had failed to ensure the end-use of funds with respect to a loan sanctioned by it.
 
Maharashtra-based Thane DCC Bank has been fined Rs2.10 lakh for non-compliance with directions issued by RBI on know-your-customer (KYC). RBI found out that the lender had failed to put in place a system of periodic updation of KYC of its customers as per the prescribed periodicity.
 
Laxmi Vishnu Sahakari Bank has been penalised Rs20,000 for non-compliance with directions issued by RBI on loans and advances to directors, their relatives and firms and concerns in which they are interested. The lender had sanctioned a loan to one of its directors. 
 
RBI says its action against these four cooperative banks is based on deficiencies in regulatory compliance and is not intended to pronounce on the validity of any transaction or agreement entered into by the banks with their customers.
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