RBI Penalises HSBC Bank for Non-Compliance With Directions on inoperative accounts and unclaimed deposits:

RBI Penalises HSBC Bank for Non-Compliance With Directions on inoperative accounts and unclaimed deposits The Reserve Bank of India (RBI) has levied a penalty of Rs 31.8 lakh on Hongkong and Shanghai Banking Corporation (HSBC) over the non-compliance with some directions on inoperative accounts and unclaimed deposits. The levy of penalty is followed by a statutory inspection for supervisory evaluation of the bank with reference to its financial position as of March 31, 2025. During the inspection of HSBC, it was found that the bank was not following the provisions of RBI directions.

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There were two main allegations against HSBC Bank. First it was alleged that HSBC did not provide a searchable database of unclaimed deposits on its website. Second, it did not assign a unique Unclaimed Deposits Reference Number (UDRN) to some deposits that were transferred to the Depositor Education and Awareness (DEA) Fund. Before imposing the penalty, RBI had sent a notice to the bank asking for an explanation. After reviewing the bank's reply and hearing its side, RBI decided that the violations were valid and imposed the fine.

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RBI also clarified that this penalty is only for not following rules and does not question any transactions between the bank and its customers.