New Delhi: The RBI, which monitors Indian banks, has caught disturbances in the government bank Canara Bank. Canara Bank has been fined for ignoring different rules. Fines have been imposed for different reasons. RBI has imposed a penalty of Rs 2.92 crore on Canara Bank for flouting the rules. According to the news, RBI has imposed a penalty of Rs 2.92 crore on Canara Bank for violating various rules. RBI said on Friday that this action was taken in connection with the linking of interest rates to external parameters like repo rate and opening of savings accounts of ineligible units. A statutory inspection was carried out on the basis. The central bank had conducted an investigation in July 2020 after receiving a complaint of a major fraud from another bank. On examination, it was found that the bank did not link the interest on ‘floating rate’ based retail loans and loans to MSMEs to the external benchmark. Also, it could not link the interest on the ‘floating rate’ based rupee loan sanctioned and renewed during the financial year 2020-21 to its Marginal Cost of Funds (MCLR).
RBI said the bank opened several savings deposit accounts in the name of ineligible entities, entered fake mobile numbers in several credit card accounts and deposited deposits under the daily deposit scheme and premature withdrawals within 24 months of account opening. Interest not paid. The Reserve Bank said that the bank charged SMS service from the customers, which was not based on its actual usage. The bank also failed to do customer due diligence on transaction basis.
“Subsequently, a notice was issued to the bank asking it to show cause as to why penalty should not be imposed on it. After considering the written and oral submissions of the bank, RBI has taken this action,” the RBI said.
