What changed

The Reserve Bank of India (RBI) has levied a penalty of ₹63.60 lakh on Central Bank of India due to deficiencies in statutory compliance related to Know Your Customer (KYC) and Basic Savings Bank Deposit Account (BSBDA) regulations. Specifically, the bank failed to upload customer KYC records to the Central KYC Records Registry within the stipulated timeline and opened duplicate BSBD accounts for customers already possessing one.

This enforcement action, stemming from a supervisory inspection as of March 31, 2025, highlights the critical importance of adhering to RBI's directives on customer identification and account management. While the penalty does not invalidate customer transactions, it underscores the need for robust internal controls and timely compliance with regulatory reporting requirements. Central Bank of India must ensure immediate remediation of these deficiencies to avoid further regulatory scrutiny or action.

What to do next

Review and ensure timely uploading of all KYC records to the Central KYC Records Registry.
Verify and rectify any instances of duplicate BSBDA accounts being opened for customers.
Strengthen internal controls and compliance monitoring for KYC and BSBDA regulations.

Penalties

₹63.60 lakh

Source document (simplified)

Press Releases

| () | |
| Date : Mar 27, 2026 | |
| RBI imposes monetary penalty on Central Bank of India | |
| | The Reserve Bank of India (RBI) has, by an order dated March 23, 2026, imposed a monetary penalty of ₹63.60 lakh (Rupees Sixty Three Lakh Sixty Thousand only) on Central Bank of India (the bank) for non-compliance with certain provisions of directions issued by RBI on ‘Know Your Customer (KYC)’ and ‘Financial lnclusion - Access to Banking Services - Basic Savings Bank Deposit Account (BSBDA)'. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949.

The Statutory Inspection for Supervisory Evaluation (ISE 2025) of the bank was conducted by RBI with reference to its financial position as on March 31, 2025. Based on the supervisory findings of non-compliance with the provisions of RBI directions, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said provisions of RBI directions.

After considering the bank’s reply to the notice, additional submission made by it and oral submissions made during the personal hearing, RBI found that the following charges against the bank were sustained, warranting imposition of monetary penalty:

i) the bank failed to upload the KYC records of certain customers onto Central KYC Records Registry within the prescribed timeline.

ii) the bank opened additional BSBD accounts of certain customers, who were already holding BSBD accounts in the bank.

The action is based on deficiencies in statutory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.

(Brij Raj)
Chief General Manager

Press Release: 2025-2026/2335 | | The Reserve Bank of India (RBI) has, by an order dated March 23, 2026, imposed a monetary penalty of ₹63.60 lakh (Rupees Sixty Three Lakh Sixty Thousand only) on Central Bank of India (the bank) for non-compliance with certain provisions of directions issued by RBI on ‘Know Your Customer (KYC)’ and ‘Financial lnclusion - Access to Banking Services - Basic Savings Bank Deposit Account (BSBDA)'. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949.

The Statutory Inspection for Supervisory Evaluation (ISE 2025) of the bank was conducted by RBI with reference to its financial position as on March 31, 2025. Based on the supervisory findings of non-compliance with the provisions of RBI directions, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said provisions of RBI directions.

After considering the bank’s reply to the notice, additional submission made by it and oral submissions made during the personal hearing, RBI found that the following charges against the bank were sustained, warranting imposition of monetary penalty:

i) the bank failed to upload the KYC records of certain customers onto Central KYC Records Registry within the prescribed timeline.

ii) the bank opened additional BSBD accounts of certain customers, who were already holding BSBD accounts in the bank.

The action is based on deficiencies in statutory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.

(Brij Raj)
Chief General Manager

Press Release: 2025-2026/2335 |
| The Reserve Bank of India (RBI) has, by an order dated March 23, 2026, imposed a monetary penalty of ₹63.60 lakh (Rupees Sixty Three Lakh Sixty Thousand only) on Central Bank of India (the bank) for non-compliance with certain provisions of directions issued by RBI on ‘Know Your Customer (KYC)’ and ‘Financial lnclusion - Access to Banking Services - Basic Savings Bank Deposit Account (BSBDA)'. This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949.

The Statutory Inspection for Supervisory Evaluation (ISE 2025) of the bank was conducted by RBI with reference to its financial position as on March 31, 2025. Based on the supervisory findings of non-compliance with the provisions of RBI directions, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said provisions of RBI directions.

After considering the bank’s reply to the notice, additional submission made by it and oral submissions made during the personal hearing, RBI found that the following charges against the bank were sustained, warranting imposition of monetary penalty:

i) the bank failed to upload the KYC records of certain customers onto Central KYC Records Registry within the prescribed timeline.

ii) the bank opened additional BSBD accounts of certain customers, who were already holding BSBD accounts in the bank.

The action is based on deficiencies in statutory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.

(Brij Raj)
Chief General Manager

Press Release: 2025-2026/2335 | |