The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 1 lakh on Yavatmal District Central Co-operative Bank Ltd., Maharashtra, for violating provisions of Section 20 read with Section 56 of the Banking Regulation Act, 1949. The penalty order, dated September 15, 2025, was issued under the powers vested in RBI under Section 47A(1)(c) and Section 46(4)(i) read with Section 56 of the Act.

The penalty follows a statutory inspection by NABARD based on the bank’s financial position as of March 31, 2024. After examining the bank’s responses to the notice and submissions made during the hearing, RBI concluded that the bank had sanctioned director-related loans, in breach of statutory provisions.

RBI clarified that the penalty is for non-compliance with regulatory norms and does not question the validity of any transactions or agreements between the bank and its customers. The imposition of this monetary penalty is without prejudice to any other regulatory action that may be taken against the bank.