RBI Imposes Monetary Penalty on Bihar-Based Monghyr-Jamui Central Co-operative Bank for Non-Compliance With KYC Guidelines:

The Reserve Bank of India (RBI) has fined the Monghyr-Jamui Central Co-operative Bank Limited in Bihar Rs 5 lakh for non-compliance of its Know Your Customer (KYC) guidelines. The order to impose penalty was issued on September 25, 2026.

The decision follows a statutory inspection of the bank by the National Bank for Agriculture and Rural Development (NABARD) on the bank’s financial position as on March 31, 2026. The inspection revealed that the bank did not comply with certain RBI directions related to KYC compliance.

After identifying the violation, RBI issued a notice to the bank asking it to explain why a penalty should not be imposed. The central bank considered the bank’s written response, additional submissions and arguments presented during a personal hearing before deciding to impose the fine.

RBI found that the bank had failed to upload customers’ KYC records to the Central KYC Records Registry (CKYCR) within the prescribed time limit. As a result, the bank was fined Rs 5 lakh under the relevant provisions of the Banking Regulation Act, 1949.

RBI clarified that the penalty relates to non-compliance with regulatory requirements and does not question the validity of transactions or agreements between the bank and its customers. The central bank also stated that the penalty does not prevent it from taking further action against the bank, if required.