Business News | RBI Imposes Monetary Penalty on Kotak Mahindra Bank over Non-compliance
Get latest articles and stories on Business at LatestLY. The Reserve Bank of India (RBI) has imposed a monetary penalty to the tune of Rs 3.95 crore on Kotak Mahindra Bank Limited for various non-compliance.
Mumbai (Maharashtra) [India], October 17 (ANI): The Reserve Bank of India (RBI) has imposed a monetary penalty to the tune of Rs 3.95 crore on Kotak Mahindra Bank Limited for various non-compliance, including in managing risks and code of conduct in outsourcing of financial services, recovery agents engaged by banks, customer service in banks, and loans and advances - statutory and other restrictions.
"This action is based on the deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers," RBI in a press release said Tuesday.
The central bank said Kotak Mahindra Bank failed to carry out an annual review or due diligence of the service provider, failed to ensure that customers were not contacted after 7 pm and before 7 am, levied interest from the disbursement due date instead of the actual date of disbursement, levied foreclosure charges despite there being no clause in the loan agreement for levy of prepayment penalty on loans recalled/foreclosure initiated by the bank.
Consequently, a notice was issued to the bank advising it to show cause as to why a penalty should not be imposed on it for failure to comply with the said direction, RBI said in the release.
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After considering the bank's reply, additional information provided by the bank, and the oral submissions made during the personal hearing, RBI said it came to the conclusion that the charge of non-compliance with the RBI directions was "substantiated and warranted" imposition of monetary penalty on the bank. (ANI)
(The above story is verified and authored by ANI staff, ANI is South Asia's leading multimedia news agency with over 100 bureaus in India, South Asia and across the globe. ANI brings the latest news on Politics and Current Affairs in India & around the World, Sports, Health, Fitness, Entertainment, & News. The views appearing in the above post do not reflect the opinions of LatestLY)