RBI imposed a ₹75 lakh penalty on HDFC Bank because the bank did not follow KYC regulations. The central bank imposed this penalty because HDFC Bank failed to properly risk-categorize customers and provided multiple identification codes instead of a single Unique Customer Identification Code per customer.
The financial position of HDFC Bank as of March 31, 2023, revealed regulatory violations during RBI’s Statutory Inspection for Supervisory Evaluation (ISE 2023). RBI sent HDFC Bank a notice which requested the bank to explain why it should avoid receiving a penalty. RBI conducted a review of the bank’s response before deciding that monetary penalties were necessary to address the observed violations.
The central bank made it clear that the penalty only addressed regulatory non-compliance without affecting the validity of customer transactions. HDFC Bank received a ₹68.20 lakh fine from RBI for financial inclusion and exposure reporting violations while klm Axiva Finvest received a ₹10 lakh penalty for dividend declaration non-compliance.
RBI emphasized its dedication to banking sector compliance while announcing that additional regulatory actions could occur due to non-compliance.
