The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹3.95 crore on Kotak Mahindra Bank Limited for non-compliance with various RBI directions. The bank was found to be in violation of RBI directions on “Managing Risks and Code of Conduct in Outsourcing of Financial Services by banks”, “Recovery Agents engaged by Banks”, “Customer Service in Banks”, and “‘Loans and Advances – Statutory and Other Restrictions’”.
The penalty has been imposed under the powers vested in RBI conferred under the provisions of Section 47A(1) read with Sections 46 (4)(i) of the Banking Regulation Act, 1949.
The action is based on deficiencies in regulatory compliance and does not intend to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. The RBI’s action is a reminder to all banks about the importance of adhering to regulatory compliance and maintaining high standards in their operations. It also underscores the need for banks to ensure that they are managing risks effectively and treating their customers fairly.
The RBI has been taking proactive measures to ensure that banks adhere to its guidelines and provide quality service to their customers. This penalty serves as a reminder for all banks about the importance of regulatory compliance.
