RBI Imposes Monetary Of Rs 90.92 Lakh Penalty On Axis Bank

Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 90.92 lakh on Axis Bank for non-compliance.

The Central Bank said that Axis Bank did not comply with certain directions issued under Reserve Bank of India (Know Your Customer) directions, 2016, loans and advances – statutory and other restrictions, guidelines on managing risks and code of conduct in outsourcing of financial services by banks and code of conduct for opening and operating current accounts.

The statutory inspection for supervisory evaluation (ISE 2022) of the bank was conducted by RBI with reference to the bank considering its financial position as of 31 March 2022. A scrutiny was also conducted by RBI involving an account.

The examination of the risk assessment report about ISE 2022 scrutiny report revealed that the bank has failed to preserve records pertaining to the identification of customers and their addresses in certain cases.

The bank has also made persistent calls to some of the customers and has failed to ensure the appropriate behaviour of recovery agents with some of the delinquent borrowers.

Also, the bank has failed to ensure a tape recording of the content or text of the calls made by the recovery agents to some of the customers and did not obtain declarations from the customer at the time of opening of current accounts.

Consequently, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for failure to comply with the directions issued by RBI, as stated therein.

Therefore, the penalty has been imposed in the exercise of powers vested in RBI conferred under the provisions of Section 47 A (1) (c) read with Section 46 (4) (i) of the Banking Regulation Act, 1949.