RBI Imposes Rs 75 Lakh Monetary Penalty On HDFC Bank
The regulatory body had also slapped penalties on KLM Axiva Finvest Ltd. and Punjab & Sind Bank, as per an order dated March 24.
The Reserve Bank of India has on Wednesday levied a penalty of Rs 75 lakh on HDFC Bank Ltd, as per a press release. The penalty is a result of non-compliance with certain directions issued by the RBI under the 'Know Your Customer' policy.
After the RBI's statutory inspection of the bank on March 31, it was discovered that the bank did not categorise certain customers into low-, medium-, or high-risk categories based on its assessment and risk perception. The bank has also allotted multiple customer identification codes to certain customers instead of a unique one for each.
The regulatory body had also slapped penalties on KLM Axiva Finvest Ltd. and Punjab & Sind Bank, as per orders dated March 24.
The PSU bank has been demanded to pay Rs 68.20 lakh for non-compliance, as the bank did not report certain borrowers with non-fund-based exposure of Rs 5 crore and above to the Central Repository of Information on Large Credits and has allowed certain account holders to open savings bank deposit accounts.
The RBI has also asked KLM Axiva Finvest Ltd. to pay Rs 10 lakh as a penalty for declaring a dividend for the financial year 2024, despite not meeting the minimum prudential requirements in each of the last three financial years.
Earlier in the day, RBI Governor Sanjay Malhotra had expressed how there is a need to have laws and regulations which target only the illegitimate and the illicit with precision, rather than use very broad and blunt tools to unintentionally hurt even the honest.
“…While making the policy, it's important to have very precise and balanced regulations. It's equally important that while we are implementing them, we keep the impact that they are going to have on the person in mind. A risk-based approach is recommended in this regard,” he said at the FATF Private Sector Collaborative Forum 2025.
Further, he also said that anti-money laundering and countering the financing of terrorism risk assessments can be further fine-tuned and refined with the adoption of new technology, tools and models.
