RBI Imposes ₹3.1 Lakh Penalty on CreditAccess Grameen Over KYC Violations

The Reserve Bank of India (RBI) on Friday imposed a penalty of ₹3.10 lakh on CreditAccess Grameen Limited for violating certain Know Your Customer (KYC) norms. RBI found that the company had not put in place a robust software system that could automatically flag transactions that were inconsistent with customers' risk profiles and updated records, a key requirement for identifying and reporting suspicious transactions. The regulator clarified that the penalty relates only to shortcomings in...

RBI Mandates 3-Year Cooling-Off For Co-Operative Bank Directors After 10-Year Continuous Tenure

The Reserve Bank of India has introduced a mandatory three-year cooling-off period for directors of urban and rural co-operative banks after they complete 10 years of continuous tenure on the board of the same bank, seeking to prevent directors from briefly stepping down and returning to circumvent tenure limits. The amendment directions, issued on May 25 by Chief General Manager Scenta Joy, came into force with immediate effect. “In a few cases, directors have been found to be resorting to...

RBI Penalises City Union Bank, Two NBFCs Over Lending, Governance and KYC Compliance Lapses

The Reserve Bank of India (RBI) has imposed monetary penalties on City Union Bank Limited, Newa Investments Private Limited, and Mintifi Finserve Private Limited for separate compliance failures identified during supervisory inspections. City Union Bank was fined ₹10.10 lakh for non-compliance with RBI directions on priority sector loan accounts and reporting obligations relating to Self Help Group (SHG) members. RBI found that the bank had levied loan-related charges on certain agriculture...

Borrower Consent Mandatory For SARFAESI Sale At Reserve Price: Andhra Pradesh High Court

The Andhra Pradesh High Court has recently held that a bank cannot confirm the sale of a secured asset in a SARFAESI auction when the highest bid matches the reserve price unless the borrower consents. “The sale of the secured asset in the auction exactly at the reserve price cannot be confirmed by the Authorised Officer without the consent of the borrower,” the Court held. A Division Bench of Justice Cheekati Manavendranath Roy and Justice V. Gopala Krishna Rao dismissed writ petitions filed...

Banks 'Casual' In Granting Big Loans, Small Borrowers Face 'Borderline Harassment': Supreme Court

The Supreme Court on Tuesday criticised banks for what it described as a casual approach in sanctioning large loans to bigger entities while subjecting ordinary borrowers seeking small personal loans to stringent conditions and tedious procedures that may, in some cases, amount to “borderline harassment." A Bench of Justices Ahsanuddin Amanullah and R. Mahadevan clarified that it was not advocating any easing of lending norms, saying those matters were best left to the Reserve Bank of India and...

RBI Appoints Gunveer Singh As Executive Director To Head Payment And Settlement Systems

The Reserve Bank of India (RBI) on Monday appointed Gunveer Singh as its new Executive Director, with responsibility for the Department of Payment and Settlement Systems. His appointment takes effect on May 18, 2026. Before his promotion, Singh was serving as Chief General Manager-in-Charge of the same department. He has more than three decades of experience at the RBI, having worked in payment and settlement systems, banking and non-banking supervision, risk monitoring, Government banking,...

RBI Imposes Penalties On Appnit Technologies, IIFL Finance For Regulatory Compliance Lapses

The Reserve Bank of India on Friday imposed monetary penalties on Appnit Technologies Private Limited and IIFL Finance Limited for separate regulatory compliance lapses. The RBI imposed a ₹5.8 lakh penalty on Appnit Technologies for non-compliance with directions relating to Know Your Customer norms and Prepaid Payment Instruments. It found that the company had allowed PPI accounts opened using Aadhaar OTP-based e-KYC to continue for more than one year without carrying out customer...

Calcutta High Court Quashes PNB Fraud Classification Against Visa Power Ltd For Breach Of Natural Justice

On 7 May, the Calcutta High Court quashed Punjab National Bank's decision classifying the loan account of Visa Power Ltd and its promoters, including Vikas Agarwal and Vishambhar Saran, as “fraud” for reporting to the Reserve Bank of India.Justice Krishna Rao set aside the show cause notice dated 25 October 2023 and the fraud classification order dated 9 August 2024, under which the account had been reported as fraud on 16 July 2024, noting that the bank failed to independently examine the...

RBI Penalises Yes Bank ₹31.8 Lakh, Hinduja Housing Finance ₹1.8 Lakh For Regulatory Lapses

The Reserve Bank of India (RBI) on Friday imposed monetary penalties on Yes Bank and Hinduja Housing Finance for separate regulatory lapses, fining the entities ₹31.80 lakh and ₹1.80 lakh, respectively. Yes Bank was penalised for non-compliance with the RBI's Know Your Customer (KYC) directions. The central bank said a statutory inspection conducted with reference to the bank's financial position as of March 31, 2025, found that the lender had failed to put in place a system for using the KYC...

Mere Default Of Business Loan Cannot Justify Issuance Of LOCs, Curtail Right To Travel Abroad: Delhi High Court

The Delhi High Court has held that Look Out Circulars (LOCs) cannot be sustained merely because loans have not been repaid and no criminal case is pending against borrowers, directors, or guarantors. "Mere inability to repay a debt, without there being a criminal case, cannot be a reason to deprive a citizen of the fundamental rights guaranteed under Article 21. The issuance of an LOC cannot be resorted to in every case of bank loan default or credit facility availed for business purposes....

Civil Courts Cannot Grant Injunctions Against SARFAESI Action: Karnataka High Court

The Karnataka High Court has set aside a Commercial Court order that had stopped lenders from taking action under the SARFAESI Act, holding that such directions cannot be issued by civil courts. Referring to Section 34 of the SARFAESI Act, which bars courts from granting injunctions in such matters, the Court said: “A plain reading of the said section indicates that it proscribes any Civil Court from issuing any injunction not only with respect to the action taken, but also to an action that...

Delhi High Court Dismisses Stock Broker's Plea Against Order Summoning Him In ₹42,000 Crore DHFL Fraud Case

The Delhi High Court has dismissed a petition filed by stockbroker Jalaj Batra challenging an order dated April 27, 2024 of a Special Judge (PC Act) at Rouse Avenue Courts, New Delhi, summoning him as an accused in the Rs 42,000 crore DHFL loan fraud and alleged share price manipulation case. The order involves taking cognisance of offences under the IPC and Prevention of Corruption Act, including criminal conspiracy, cheating, forgery and corruption. A bench of Justice Manoj Jain held that...