According to reports, the Reserve Bank imposes a penalty of Rs 1.27 crore on Bank of Maharashtra (BoM) for violating its directions, including on Know Your Customer.

The Reserve Bank of India (RBI) has, by an order dated August 8, 2024, imposed a monetary penalty of Rs 1.27 crore on Bank of Maharashtra for non-compliance with certain directions issued by RBI on 'Loan System for Delivery of Bank Credit', 'Cyber Security Framework in Banks' and 'Know Your Customer'.

The RBI concluded that the accusations against the bank were justified and that a monetary penalty should be imposed after taking into account the bank's response to the notice, its oral representations during the personal hearing, and an analysis of its further submissions.

Additionally, Hinduja Leyland Finance Ltd. has been fined Rs 4.90 lakh by the RBI for failing to comply with specific guidelines in the Know Your Customer (KYC) Directions, 2016.

The action is based on a failure to comply with regulations and is not meant to rule on the legality of any agreements or transactions the company has with its clients, as per reports.

Poonawalla Fincorp Ltd has also been fined Rs 10 lakh by the central bank for failing to comply with the guidelines set forth in the Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016'.

RBI determined that the following accusation against the company was sustained, necessitating the imposition of a monetary penalty, after taking into account the company's response to the notice, oral representations made during the personal hearing, and review of supplementary submissions made by it.

In violation of the loan terms and circumstances that were disclosed to the clients, the corporation charged interest on loans from dates before the loans were disbursed.