**Executive Summary**
The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹2 lakh on Jila Sahakari Bank Limited, Mau, Uttar Pradesh, for non-compliance with KYC directions. The penalty was imposed based on findings from a NABARD inspection as of March 31, 2024, regarding non-compliance with RBI directions. The order was issued on December 31, 2025.
**Key Points / Main Content**
* **Penalty Imposition:**
* RBI imposed a monetary penalty of ₹2 lakh on Jila Sahakari Bank Limited.
* The penalty is for non-compliance with KYC directions.
* The order was dated December 31, 2025.
* RBI exercised powers under Section 47A(1)(c), read with Sections 46(4)(i) and 56 of BR Act.
* **Inspection Findings:**
* NABARD conducted a statutory inspection of the bank as of March 31, 2024.
* The inspection revealed non-compliance with RBI directions.
* A notice was issued to the bank advising it to show cause for non-compliance.
* The penalty was warranted after reviewing the bank's response and oral submissions.
* **Specific Failures of the Bank:**
* The bank failed to implement a system for periodic review of risk categorization of accounts (at least once in six months).
* The bank failed to carry out periodic updates of KYC for its customers.
* **Disclaimer:**
* The action is based on regulatory compliance deficiencies.
* The action is not intended to pronounce upon the validity of transactions or agreements entered into by the bank with its customers.
* The monetary penalty is without prejudice to other actions RBI may initiate.
**Impact Analysis**
**Jila Sahakari Bank Limited, Mau, Uttar Pradesh**
* **Impact:** The bank is subject to a monetary penalty of ₹2 lakh and must address the deficiencies in KYC compliance identified by the RBI.
* **Action Required:** The bank must pay the penalty and implement corrective measures to ensure compliance with KYC directions, including establishing a system for periodic risk categorization reviews and updating KYC information.
**RBI**
* **Impact:** The RBI enforces regulatory compliance among cooperative banks, ensuring adherence to KYC norms.
* **Action Required:** The RBI monitors the corrective actions taken by the Jila Sahakari Bank Limited to rectify the identified non-compliance issues.
Key Entities Referenced
Reserve Bank of India (RBI): The regulator that imposed the monetary penalty for KYC non-compliance.
BR Act: Banking Regulation Act, under which the penalty was imposed.
Section 47A(1)(c): Section of the Banking Regulation Act used for imposing the penalty.
Know Your Customer (KYC): Regulations for which non-compliance led to the penalty.
Jila Sahakari Bank Limited, Mau, Uttar Pradesh: The bank on which RBI imposed the penalty.
प्रेस प्रकाशनी PRESS RELEASE
भारतीय ररज़र्व बैंक
RESERVE BANK OF INDIA
वेबसाइट
:
www.rbi.org.in/hindi
संचार वर्भाग, केंद्रीय कायाालय, शहीद भगत ससिंह मागा, फोटा, म िंबई - 400 001
Website : www.rbi.org.in Department of Communication, Central Office, Shahid Bhagat Singh Marg, Fort,
ई-मेल/email : helpdoc@rbi.org.in Mumbai - 400 001 फोन/Phone: 022 - 2266 0502
January 05, 2026
RBI imposes monetary penalty on Jila Sahakari Bank Limited, Mau,
Uttar Pradesh
The Reserve Bank of India (RBI) has, by an order dated December 31, 2025,
imposed a monetary penalty of ₹2 lakh (Rupees Two Lakh only) on Jila Sahakari Bank
Limited, Mau, Uttar Pradesh (the bank) for non-compliance with certain directions
issued by RBI on ‘Know Your Customer (KYC)’. This penalty has been imposed in
exercise of powers conferred on RBI under the provisions of Section 47A(1)(c) read
with Sections 46(4)(i) and 56 of BR Act.
The statutory inspection of the bank was conducted by National Bank for Agriculture
and Rural Development (NABARD) with reference to its financial position as on March
31, 2024. Based on supervisory findings of non-compliance with RBI directions and
related correspondence in that regard, a notice was issued to the bank advising it to
show cause as to why penalty should not be imposed on it for its failure to comply with
the said directions. After considering the bank’s reply to the notice and oral submissions
made during the personal hearing, RBI found, inter alia, that the following charges
against the bank were sustained, warranting imposition of monetary penalty:
The bank had failed to:
i. put in place a system of periodic review of risk categorisation of accounts, with
such periodicity being at least once in six months; and
ii. carry out periodic updation of KYC of its customers.
This action is based on 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. Further, imposition of this monetary penalty is without prejudice to
any other action that may be initiated by RBI against the bank.
(Brij Raj)
Press Release: 2025-2026/1846 Chief General Manager