RBI imposes ₹15 lakh fine on Mumbai's Bharat Co-operative Bank for violating interest norms

The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹15 lakh on Bharat Co-operative Bank (Mumbai) Limited for non-compliance with its directions on interest rates on deposits.

In a statement, the central bank said the penalty was imposed through an order dated February 6, 2026, under the provisions of the Banking Regulation Act, 1949.

The action followed a statutory inspection of the bank conducted by RBI with reference to its financial position as on March 31, 2025.

Based on supervisory findings, RBI issued a show-cause notice to the lender, seeking an explanation as to why a penalty should not be levied for failure to comply with regulatory directions.

After considering the bank’s written reply and oral submissions made during a personal hearing, RBI concluded that the charge was sustained.

“The bank did not pay any interest on certain eligible term deposits, which were withdrawn prematurely,” RBI said.

The regulator clarified that the penalty is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.

It also said the action is without prejudice to any other measures that may be initiated against the lender.

“Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank,” it added.