RBI: RBI imposes penalty of Rs 1.32 crore on PNB for not following bank instructions

Reserve Bank: The Reserve Bank of India imposed a penalty of Rs 1.32 crore on Punjab National Bank on Friday. This penalty has been imposed on the bank because the bank has violated certain rules. The RBI said the bank did not follow the guidelines related to KYC and loans and counselling. The Reserve Bank of India informed that a statutory audit was conducted on the bank's financial position as on March 31, 2022. A notice was sent to the bank. After considering the clarification provided by RBI, RBI confirmed that PNB has two state government owned working capital days as per rules. These loans were disbursed on the basis of the amount received by repaying the refined government subsidy. Also Read: Gold prices: Patna-Ranchi gold prices hit 10-day high – According to RBI rules, which rules did PNB violate? PNB has sanctioned loan requirement as working capital to two government owned companies. These loans were disbursed on the basis of subsidy difference or reimbursement received from the government. Identity Violations- We inform you that PNB has failed to properly maintain documents related to identity and address of customers for certain accounts. This document is important to prevent money laundering and non-criminal offences. PNB put itself at risk by not following KYC rules. Why is KYC important? (Know Your Customer) Used by business or financial institutions to verify the identity of their customers. Many illegal activities can be prevented through this process- The process of KYC helps banks and financial institutions to verify the identity and address of their customers. This ensures that the accounts are not used by any fraudsters. KYC also helps ensure that bank accounts are not used to fund terrorist activities. KYC is also helpful in preventing illegal money laundering activities by criminals. It helps banks to check the amount of deposit or transaction according to the income and profile of the customer. Through KYC, the bank can assess how much credit should be given to a person and whether he can repay the loan amount or not. KYC is also very important in customer security. KYC helps ensure that the customer's account is not linked to any illegal activities. Also Read: Why Filing ITR Is Important? Read expert opinion The post RBI: RBI imposes 1.32 crore penalty on PNB, the bank did not follow instructions appeared first on Prabhat Khabar.