RBI imposes a monetary penalty of ₹90.92 lakh on Axis Bank. Details here

A monetary penalty was imposed by the Reserve Bank of India 90.92 lakh on Axis Bank Ltd for non-compliance of certain instructions issued by the apex bank regarding ‘Reserve Bank of India (Know Your Customer (KYC)) Instructions, 2016’, ‘Loans and Advances – Statutory and Other Restrictions ‘, ‘Risk Management Guidelines and Code of Conduct for Outsourcing Financial Services by Banks’ and ‘Code of Conduct for Opening and Operating Current Accounts’.

The Reserve Bank said that after examining the Risk Assessment Report/Inspection Report relating to ISE 2022, the Audit Report and all related correspondence in this regard, it noted that Axis Bank failed to maintain records relating to identification customers and to preserve their address in some cases. cases, and they made continuous calls to some of the customers.

“The bank also failed to ensure proper conduct of recovery agents with some of the delinquent borrowers and failed to ensure tape recording of the content/text of the calls made by the recovery agents to some of the customers”, the RBI said.

The bank did not receive declarations from the customer at the time of opening the current accounts, the RBI added.

As a result, a notice was issued to the bank advising it to show cause that it should not be penalized for failure to comply with the instructions issued by RBI, as stated therein.

The banking regulator said after considering Axis Bank’s response to the notice, oral submissions made during the personal hearing and additional submissions made by it, the apex bank came to the conclusion that the charge was well founded non-compliance mentioned above and was justified in imposing it. of monetary penalty.

This penalty was imposed in exercise of the powers vested in RBI conferred under the provisions of the Banking Regulation Act, 1949.

The RBI also said that this action is based on the deficiencies in regulatory compliance and is not intended to pronounce on the validity of any transaction or agreement entered into by the bank with its customers.

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Updated: 16 November 2023, 06:45 PM IST

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