City Union Bank has been penalised by the Reserve Bank of India (RBI) with a monetary fine totalling Rs 10.10 lakh. The penalty was imposed following a statutory inspection for supervisory evaluation, which revealed non-compliance with certain RBI directives as of 31st March 2025.
The RBI identified two key areas of non-compliance. Firstly, City Union Bank had levied loan-related charges on certain agricultural priority sector loans up to ₹25,000. Secondly, the bank failed to report member-level data of Self Help Groups to Credit Information Companies. These actions were deemed to contravene the RBI’s guidelines on priority sector loan accounts and the reporting of Self Help Group member data.
The penalty comprises two components: Rs 10 lakh for the improper levying of charges on agricultural loans, and Rs 0.10 lakh for the failure to report data to Credit Information Companies. The RBI communicated this penalty to City Union Bank via a letter dated 22nd May 2026.
This regulatory action underscores the importance of adherence to RBI guidelines, particularly concerning priority sector lending and data reporting requirements, which are critical for maintaining transparency and accountability in the banking sector.
Disclaimer: This article is based on a regulatory filing submitted to the National Stock Exchange of India (NSE).