The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 7.5 lakh on The Himachal Pradesh State Co-operative Bank for non-compliance with KYC norms.

The action follows findings from a NABARD inspection based on the bank’s financial position as of March 31, 2025. The RBI observed that the bank failed to implement a system for periodic review of risk categorisation of accounts, as required under KYC guidelines.

After reviewing the bank’s response and submissions, the central bank concluded that the violation warranted a penalty.

RBI clarified that the penalty is due to regulatory lapses and does not impact the validity of any transactions carried out by the bank. Further actions may be taken if necessary.