The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 5 lakh on Mahila Co-operative Bank Ltd. for non-compliance with regulatory directions relating to loans and advances granted to directors, their relatives, and entities in which they have an interest.

The penalty was imposed through an order dated June 11, 2026, under the provisions of the Banking Regulation Act, 1949, following RBI's statutory inspection of the bank based on its financial position as of March 31, 2025.

According to the RBI, supervisory findings revealed violations of its lending norms. After reviewing the bank's response to a show-cause notice and considering oral submissions made during a personal hearing, the central bank concluded that the bank had sanctioned director-related loans, resulting in a breach of regulatory guidelines.

The RBI clarified that the penalty pertains solely to deficiencies in regulatory compliance and should not be interpreted as a judgment on the validity of any transactions or agreements entered into by the bank with its customers.

The central bank further stated that the monetary penalty is without prejudice to any additional supervisory or regulatory action that may be initiated against the bank in the future.