**Executive Summary**
The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹38.60 lakh on UCO Bank for non-compliance with certain RBI directions. This penalty was ordered on February 16, 2026, and communicated via a press release on February 20, 2026. The non-compliance was identified during the Statutory Inspection for Supervisory Evaluation (ISE 2025) with reference to the bank's financial position as of March 31, 2025.
**Key Points / Main Content**
* **Penalty Imposition:**
* RBI imposed a monetary penalty of ₹38.60 lakh on UCO Bank.
* The order was dated February 16, 2026.
* **Reasons for Penalty:** The penalty was imposed due to non-compliance with RBI directions on:
* Periodicity of payment of interest on savings deposits.
* Locker Rent.
* Credit Information Reporting in respect of Self Help Group (SHG) members.
* **Legal Basis:** The penalty was imposed under the provisions of:
* Section 47A(1)(c) read with section 46(4)(i) and 51(1) of the Banking Regulation Act, 1949.
* Section 25(1)(iii) read with section 23(4) of the Credit Information Companies (Regulation) Act, 2005.
* **Findings of Non-Compliance:** The Statutory Inspection for Supervisory Evaluation (ISE 2025) as of March 31, 2025, revealed that UCO Bank:
* Did not pay any interest on certain Savings Bank Deposit accounts.
* Did not report credit-related Self Help Group member-level data to Credit Information Companies.
* Did not refund the proportionate amount of advance locker rent collected in case of premature surrender of locker by certain customers.
* **Disclaimer:** The 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 monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.
**Impact Analysis**
**UCO Bank**
* **Impact:** Financial penalty of ₹38.60 lakh and reputational damage due to non-compliance.
* **Action Required:** UCO Bank must rectify the identified deficiencies in regulatory compliance to avoid further penalties.
**UCO Bank's Customers**
* **Impact:** Potential inconvenience due to the issues with interest payments on savings deposits and locker rent refunds.
* **Action Required:** Customers should check their savings deposit accounts and locker agreements to ensure compliance.
**Reserve Bank of India (RBI)**
* **Impact:** Enforcement of regulatory compliance and protection of the banking system's integrity.
* **Action Required:** Monitor UCO Bank's corrective actions and potentially initiate further actions if necessary.
Key Entities Referenced
Banking Regulation Act, 1949: Act cited as the legal basis for the penalty.
Reserve Bank of India (RBI): The regulator that imposed the monetary penalty.
Credit Information Companies (Regulation) Act, 2005: Act cited as the legal basis for the penalty.
UCO Bank: The bank on which the monetary penalty was imposed.
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
February 20, 2026
Reserve Bank of India imposes monetary penalty on UCO Bank
The Reserve Bank of India (RBI) has, by an order dated February 16, 2026,
imposed a monetary penalty of ₹38.60 lakh (Rupees Thirty Eight Lakh Sixty
Thousand only) on UCO Bank (the bank) for non-compliance with certain directions
issued by RBI on ‘Periodicity of payment of interest on savings deposits’, ‘Locker
Rent’ and ‘Credit Information Reporting in respect of Self Help Group (SHG)
members’. This penalty has been imposed in exercise of powers conferred on RBI
under the provisions of section 47A(1)(c) read with section 46(4)(i) and 51(1) of the
Banking Regulation Act, 1949 and section 25(1)(iii) read with section 23(4) of the
Credit Information Companies (Regulation) Act, 2005.
The Statutory Inspection for Supervisory Evaluation (ISE 2025) of the bank was
conducted by RBI with reference to its financial position as on March 31, 2025.
Based on supervisory findings of non-compliance with the provisions of 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 provisions of RBI directions.
After considering the bank’s reply to the notice and additional submissions made
by it, RBI found that the following charges against the bank were sustained,
warranting imposition of monetary penalty:
i. The bank did not pay any interest on certain Savings Bank Deposit accounts;
ii. The bank did not report credit related Self Help Group member level data to Credit
Information Companies; and
iii. The bank did not refund the proportionate amount of advance locker rent collected
in case of premature surrender of locker by certain 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 monetary penalty is without prejudice
to any other action that may be initiated by RBI against the bank.
(Brij Raj)
Press Release: 2025-2026/2148 Chief General Manager