Penalty Handed to Axis Bank: In a major move, the Reserve Bank of India has levied a hefty fine of Rs 90.92 lakh on Axis Bank for non-compliance with RBI regulations. The central bank revealed this development in a press release, citing the bank’s failure to adhere to Know Your Customer (KYC) rules and maintain essential customer identity and address records. The penalty was imposed for the bank’s lapse in following the 2016 KYC guidelines.
Reasons Behind the Action:
- KYC Violation: Axis Bank faced the penalty for neglecting KYC norms, specifically the inadequate maintenance of identity and address details for certain customers.
- Recovery Agents’ Misconduct: The RBI also noted inappropriate behavior by some recovery agents of Axis Bank during loan recovery from customers. Despite the bank’s response to the notice issued by the RBI, the central bank found it unsatisfactory, resulting in the imposition of the penalty.
In a parallel move, the RBI also took action against Manappuram Finance, slapping a total fine of Rs 42.78 lakh on the finance company. This penalty was enforced due to violations of regulations pertaining to Non-Banking Finance Company-Systemically Important Non-Deposit Taking Company and Deposit Taking Company in 2016.