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The Reserve Bank of India (RBI), by an order dated September 08, 2025, has imposed a monetary penalty of Rs 50,000 (Rupees Fifty Thousand only) on Sikkim State Co-operative Bank Ltd. for non-compliance with certain RBI directions on ‘Know Your Customer (KYC)’. The penalty has been imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
The statutory inspection of the bank was conducted by the National Bank for Agriculture and Rural Development (NABARD) with reference to its financial position as on March 31, 2024. Based on supervisory findings of non-compliance with RBI directions and related correspondence, a notice was issued to the bank to show cause why a penalty should not be imposed for its failure to comply with the said directions.
After considering the bank’s reply and oral submissions during the personal hearing, RBI found that the bank had failed to upload the KYC records of customers onto the Central KYC Records Registry (CKYCR) within the prescribed timeline, warranting imposition of the monetary penalty.
RBI clarified that this action is based on deficiencies in regulatory compliance and does not question the validity of any transactions or agreements entered into by the bank with its customers. Further, the imposition of this penalty is without prejudice to any other action that may be initiated by RBI against the bank.
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