Document title: RBI imposes monetary penalty on The Modern Co-operative Bank Limited
Issuing authority: Reserve Bank of India
Reference number: Press Release: 2026-2027/543
Date: June 25, 2026
Regulatory and Policy Measures
The Reserve Bank of India, by an order dated June 23, 2026, imposed a monetary penalty of ₹1 lakh (Rupees One Lakh only) on The Modern Co-operative Bank Limited, Chalisgaon, Maharashtra. The penalty is imposed under the powers conferred by Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949. The statutory inspection of the bank, conducted with reference to its financial position as on March 31, 2025, identified non‑compliance with RBI directions on ‘Exposure Norms and Statutory / Other Restrictions – UCBs’ and ‘Know Your Customer (KYC)’. A show‑cause notice was issued, and after considering the bank’s reply, RBI sustained two charges: (i) breach of the prescribed regulatory limit for single borrower exposure, and (ii) failure to upload the KYC records of customers onto the Central KYC Records Registry (CKYCR) within the prescribed timeline. The RBI clarified that the penalty is imposed solely for deficiencies in regulatory compliance and does not pronounce on the validity of any transaction or agreement entered into by the bank with its customers. The penalty is imposed without prejudice to any other action that may be initiated by the RBI against the bank.