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RBI Imposes ₹5 Lakh Penalty on The Monghyr-Jamui Central Co-operative Bank Limited for CKYCR Non-Compliance

The Reserve Bank of India (RBI), via Press Release 2026-2027/1287 (PRID: 63765) dated October 8, 2026, has imposed a monetary penalty of ₹5.00 Lakh (Rupees Five Lakh only) on The Monghyr-Jamui Central Co-operative Bank Limited, Bihar for failing to comply with statutory ‘Know Your Customer (KYC)’ norms.

Economy2 min read

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Statutory Inspection & Regulatory Trigger

The enforcement action—executed through an official RBI order dated September 25, 2026—originated from a statutory inspection of the district central co-operative bank conducted by the National Bank for Agriculture and Rural Development (NABARD). The supervisory examination evaluated the bank’s governance, compliance, and financial position as on March 31, 2026.

Based on supervisory findings of non-compliance with RBI directions and related correspondence, the central bank issued a formal show-cause notice advising the bank to explain why a monetary penalty should not be imposed for its failure to adhere to statutory KYC mandates.

Specific Sustained Charge: CKYCR Upload Lapses

After reviewing the bank’s written reply, additional submissions, and oral representations made during a personal hearing, the RBI determined that the following regulatory violation was sustained, warranting a monetary penalty:

  • Delayed CKYCR Reporting: The bank failed to upload the KYC records of its customers onto the Central KYC Records Registry (CKYCR) within the prescribed regulatory timeline.

Statutory Authority & Customer Safeguards

The ₹5 Lakh penalty has been imposed in exercise of powers vested in the Reserve Bank of India under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.

In line with standard regulatory disclosures signed by Brij Raj (Chief General Manager, RBI), the central bank clarified that the monetary penalty is strictly based on deficiencies in regulatory compliance. It does not pronounce upon the validity of any transaction or agreement entered into by the bank with its customers, and is imposed without prejudice to any other regulatory action that may be initiated by the RBI against the bank.

Why it matters

Why It Matters for Co-operative Banks

Timely synchronization with CKYCR has become one of the most frequently enforced compliance benchmarks across urban and district central co-operative banks in FY27. As NABARD and the RBI tighten supervisory audits on AML/KYC infrastructure, co-operative lenders face growing pressure to replace manual batch uploads with automated, API-driven CKYCR reporting pipelines.

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Sources

Finsamudra Desk9 Oct 2026, 12:17 pm IST
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