Vadodara: The Reserve Bank of India (RBI), through an order dated September 22, 2025, imposed a monetary penalty of ₹2 lakh on Makarpura Industrial Estate Co-operative Bank Ltd for non-compliance with directions on Know Your Customer (KYC) and the Basic Cyber Security Framework for Primary (Urban) Cooperative Banks (UCBs) read with the Comprehensive Cyber Security Framework for UCBs – A Graded Approach.

A statutory inspection of the bank was carried out by RBI with reference to its financial position as on March 31, 2024. Based on supervisory findings of non-compliance and subsequent correspondence, the bank was issued a notice to show cause as to why a penalty should not be imposed. After considering the bank’s written response, oral submissions during the personal hearing, and additional representations, RBI concluded that the following charges were sustained:

• Failure to carry out periodic review of risk categorisation of certain accounts (at least once in six months).

• Failure to implement certain cyber security control measures mandated under the RBI’s Cyber Security Framework.

RBI clarified that this action is based on deficiencies in regulatory compliance and is not intended to question the validity of any transactions or agreements entered into by the bank with its customers. The imposition of penalty is also without prejudice to any other regulatory or supervisory action that may be initiated against the bank. DeshGujarat