RBI Fines Canara Bank: Reserve Bank of India imposed a fine of Rs 41.8 lakh on Canara Bank, know what is the reason?

Business Desk – RBI Fines Canara Bank: Reserve Bank of India (RBI) has imposed a fine of Rs 41.8 lakh on Canara Bank. This action has been taken by the bank for not properly following some important banking rules and KYC (Know Your Customer) guidelines.

RBI investigation revealed that Canara Bank did not upload the KYC records of many customers on the Central KYC Records Registry (CKYCR) within the stipulated time limit. According to the rules, banks are required to update the KYC data of all new and old customers in this central system on time, so that transparency is maintained in the banking system and fraud can be prevented. But Canara Bank missed this deadline.

Accounts with current transactions also declared inoperative

The second matter is related to customer accounts. According to RBI rules, if any transaction has taken place in an account within the last one year then it is considered active. But investigation found that Canara Bank also declared many such accounts inoperative (inactive) in which the period of one year was not completed. This was considered a direct violation of RBI guidelines.

ISE 2025 audit revealed irregularities

RBI has taken this action under Supervisory Evaluation (ISE 2025). For this, a detailed investigation of the financial position and functioning of the bank till March 31, 2025 was done. After finding shortcomings in the investigation, RBI had issued a show cause notice to the bank. After considering the reply received from the bank and oral submissions, the decision to impose this penalty was taken.

There will be no impact on customers

RBI has made it clear that this penalty has been imposed only due to lapses in following the rules. This will not have any impact on the bank’s customers or their money. The normal functioning of Canara Bank and the deposits of customers will remain completely safe.