RBI Imposes ₹41.80 Lakh Penalty On Canara Bank For KYC, Inoperative Accounts Norm Violations

The Reserve Bank of India on Friday imposed a ₹41.80 lakh penalty on Canara Bank for violating certain Know Your Customer (KYC) and unclaimed deposits norms.

The action stems from a Statutory Inspection for Supervisory Evaluation conducted on March 31, 2025.

According to the RBI, Canara Bank failed to upload the KYC records of certain customers to the Central KYC Records Registry within the prescribed timeline.

The regulator also found that the bank had marked some accounts as inoperative even though the last customer-induced transaction in those accounts had taken place less than a year earlier.

Before taking action, RBI issued a show-cause notice to the bank and considered its written and oral submissions.

The central bank clarified that the penalty relates only to deficiencies in regulatory compliance and does not affect the validity of transactions or agreements entered into by the bank with its customers. It added that the action does not preclude any further steps that may be taken against the bank.