Document title: Reserve Bank of India imposes monetary penalty on IndusInd Bank Limited
Issuing authority: Reserve Bank of India
Reference number: Press Release: 2026-2027/897
Date: August 14, 2026
Banking and Credit
The Reserve Bank of India, by an order dated 14 August 2026, imposed a monetary penalty of ₹59.20 lakh on IndusInd Bank Limited for non‑compliance with RBI directions concerning the interest rate on deposits and the securitisation of standard assets. The supervisory inspection covered the bank’s financial position as on 31 March 2025. Following the inspection, a notice was issued to the bank seeking its explanation for the alleged breaches. After considering the bank’s written reply, additional submissions and oral arguments presented during a personal hearing, RBI sustained two charges: (i) payment of interest on deposits held in certain current accounts, and (ii) undertaking activities classified as ‘Synthetic Securitisation’.
Regulatory and Policy Measures
The penalty is imposed under the powers conferred on RBI by section 47A(1)(c) read with section 46(4)(i) of the Banking Regulation Act, 1949. RBI clarified that the action addresses deficiencies in regulatory compliance and does not adjudicate on the validity of any transaction or agreement between the bank and its customers. The monetary penalty is imposed without prejudice to any further action that RBI may initiate against the bank.
The RBI’s action underscores its commitment to enforce compliance with its regulatory directives and to maintain the integrity of banking operations.