₹63.6 Lakh Fine - Business Outrank

The RBI imposed a ₹63.60 lakh fine on Union Bank of India because the bank failed to follow crucial regulatory requirements for fund transfers of depositors and agricultural loan procedures. The Reserve Bank of India issued this decision on May 23, 2025 because Union Bank violated Section 26A of the Banking Regulation Act 1949 and RBI guidelines for collateral-free agricultural lending. The RBI conducted Statutory Inspections for Supervisory Evaluation (ISE) in the fiscal years ending in March 2023 and March 2024 to detect non-compliance issues that resulted in this penalty. The RBI determined Union Bank non-compliant because the bank failed to transfer eligible unclaimed deposits to the Depositor Education and Awareness Fund (DEAF) and because the bank demanded collateral for small-ticket agricultural loans below ₹1.6 lakh which violates RBI's rural credit access regulations. The bank's written and oral explanations failed to justify the severity of the breaches according to RBI so monetary penalties were imposed. The central bank declared that this regulatory measure does not affect the validity of any customer-level transactions or banking operations. The recent penalty against Union Bank amounts to ₹1.66 lakh and it was issued one week after the bank received a ₹1.66 lakh fine for soiled currency remittance and ATM cash-out irregularities which indicates ongoing minor compliance issues at the public sector bank. The announcement about the regulatory action did not significantly affect Union Bank's stock price because its shares rose to ₹140.40 on the BSE before the announcement. The RBI maintains strict oversight of public sector banks while maintaining its complete rejection of non-compliance practices.

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Browsing: ₹63.6 Lakh Fine