**Summary:**
On August 5, 2025, the Reserve Bank of India (RBI) imposed a monetary penalty of ₹2.53 lakh on The Utkal Cooperative Bank Limited, Bhubaneswar, for non-compliance with specific directives issued by RBI under the Supervisory Action Framework (SAF), directions on Membership of Credit Information Companies (CICs) by Cooperative Banks, and Know Your Customer (KYC) guidelines. The penalty was imposed under the provisions of Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, and Section 25 read with Section 23 of the Credit Information Companies Regulation Act, 2005.
A statutory inspection of the bank, conducted with reference to its financial position as of March 31, 2024, revealed the following violations: incurring capital expenditure without prior RBI approval in non-adherence to SAF directions; failure to submit customer credit information to three Credit Information Companies; failure to upload customer KYC records onto the Central KYC Records Registry (CKYCR); and failure to implement a system for periodic review of risk categorization of accounts at least once every six months.
The RBI issued a notice to the bank, and after considering the bank's response and oral submissions, determined that the charges were sustained, warranting the monetary penalty. The RBI clarified that this action is based on deficiencies in regulatory compliance and does not reflect on the validity of any transactions or agreements between the bank and its customers. Furthermore, the imposition of this penalty does not preclude any other actions that may be initiated by RBI against the bank.
For further information, contact the Department of Communication, Central Office, Reserve Bank of India, Shahid Bhagat Singh Marg, Fort, Mumbai – 400 001. Email: helpdoc@rbi.org.in. Phone: 022-2266 0502. Puneet Pancholy, Chief General Manager, issued the press release (2025-2026/882). Website: www.rbi.org.in.
Key Entities Referenced
Reserve Bank of India (RBI): The central bank of India, which imposed a monetary penalty on The Utkal Cooperative Bank Limited.
The Utkal Cooperative Bank Limited, Bhubaneswar: A cooperative bank based in Bhubaneswar, Odisha, that was penalized by the RBI for non-compliance.
Bhubaneswar, Odisha: The city and state where The Utkal Cooperative Bank Limited is located.
Supervisory Action Framework (SAF): A framework used by the RBI, specific directions under which were not complied with by The Utkal Cooperative Bank Limited.
Credit Information Companies (CICs): Entities related to membership and directions issued by RBI, for which The Utkal Cooperative Bank Limited showed non-compliance.
Know Your Customer (KYC): A set of regulations and guidelines for which non-compliance led to a penalty for The Utkal Cooperative Bank Limited.
Banking Regulation Act, 1949: The act under which the RBI's powers to impose the penalty are conferred, specifically Sections 47A1c, 464i, and 56.
Credit Information Companies Regulation Act, 2005: The act under which the RBI's powers to impose the penalty are conferred, specifically Section 25 read with Section 23.
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
August 11, 2025
RBI imposes monetary penalty on The Utkal Cooperative Bank Limited,
Bhubaneswar
The Reserve Bank of India (RBI) has, by an order dated August 05, 2025,
imposed a monetary penalty of ₹2.53 lakh (Rupees Two Lakh Fifty Three Thousand
only) on The Utkal Cooperative Bank Limited, Bhubaneswar (the bank) for non-
compliance with specific directions issued by RBI under ‘Supervisory Action
Framework (SAF)’ and certain directions issued on ‘Membership of Credit Information
Companies (CICs) by Co-operative Banks’ and ‘Know Your Customer (KYC)’. This
penalty has been imposed in exercise of powers conferred on RBI under provisions
of Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation
Act, 1949 and Section 25 read with Section 23 of the Credit Information Companies
(Regulation) Act, 2005.
The statutory inspection of the bank was conducted by the RBI 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:
i) incurred capital expenditure without prior approval of RBI in non-adherence to
directions under SAF;
ii) failed to submit credit information of customers to three Credit Information
Companies;
iii) failed to upload the KYC records of customers onto Central KYC Records
Registry (CKYCR); and
iv) failed to put in place a system of periodic review of risk categorisation of
accounts with such periodicity being at least once in six months.
This action is based on deficiency 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.
(Puneet Pancholy)
Press Release: 2025-2026/882 Chief General Manager