RBI Enforcement Actions in FY25

In FY25, the Reserve Bank of India (RBI) undertook 79 enforcement actions against regulated financial entities, according to a report by FACE (Fintech Association for Consumer Empowerment), a recognised self-regulatory organisation.

Breakdown of Enforcement Actions

• Total actions: 79
  • NBFCs: 48 actions (60%)
  • Banks: 30 actions (38%)
  • Credit Bureaus: 1 action (2%)
• Total penalties levied: ₹33 crore

Penalty Distribution

• Banks:
  • Accounted for 82% of total penalty amount
  • Faced 38% of cases
• NBFCs:
  • Accounted for 18% of total penalty amount
  • Incurred 60% of cases

Note: Regional Rural Banks and Cooperative Banks were not covered in this report.

Common Reasons for Regulatory Action

• Non-compliance with KYC norms
• Violations of the Fair Practices Code
• Issues related to corporate governance
• Breaches in digital lending guidelines
• Deficiencies in reporting, interest rate disclosure
• Improper conduct in outsourcing arrangements

Major Penalties in FY25

1. J&K Bank – ₹3.31 crore
   • Opened both BSBDA and Savings Accounts for same customers
   • Failed to identify beneficial owners in legal person accounts
   • Allowed non-compliant operations in small accounts
   • Improperly sanctioned working capital loans against government subsidies
2. UCO Bank – ₹2 crore
   • Penalised for violations of several regulatory norms
3. Axis Bank – ₹1.9 crore
   • Also fined for multiple regulatory breaches

BL