Penalty Scheme for Banks on Customer Service Deficiencies

Notifications - Reserve Bank of India Skip to main content Selected Selected Change Language हिंदी Search the Website Search Home About Us ▼ About Us Organisation & Functions ▶ Organisation Structure Departments Offices Training Establishment ▶ College of Agricultural Banking Reserve Bank Staff College College of Supervisors RBI's Functions and Working Governors Deputy Governors Executive Directors Communication Policy of RBI Sources of Information ▶ Annual Publications Half-yearly Publications Quarterly Publications Monthly Publications Weekly Publications Occasional Publications SDDS NSDP Data Releases Publications available on Subscription General Information RBI History Museum ▶ The RBI Museum RBI Monetary Museum Notification ▼ Notifications Master Directions Master Circulars Amendment Directions Draft Notifications/Guidelines ▶ Draft Notifications/Guidelines Draft Directions (RE-wise) Index To RBI Circulars Standalone Circulars Circulars Withdrawn Press Releases Speeches & Media Interactions ▼ Speeches Media Interactions Memorial Lectures Podcasts Publications ▼ Biennial Annual Half-Yearly Quarterly Bi-monthly Monthly Weekly Occasional Reports Working Papers Legal Framework ▼ Act Rules Regulations Schemes Research ▼ External Research Schemes RBI Occasional Papers Working Papers RBI Bulletin History DRG Studies KLEMS State Statistics and Finances Statistics ▼ Data Releases Database on Indian Economy Public Debt Statistics Regulatory Reporting ▼ List of Returns Data Definition Validation rules/ Taxonomy List of RBI Reporting Portals FAQs of RBI Reporting Portals Home Notifications Notifications Withdrawn with effect from November 16, 2021, February 18, 2022, May 02, 2022, May 13, 2022, May 21, 2024, July 12, 2024 & October 01, 2024 ( 791 kb ) Master Circular – Scheme of Penalties for bank branches including Currency Chests for deficiency in rendering customer service to the members of public RBI/2022-23/04 DCM (CC) No.G-5/03.44.01/2022-23 April 01, 2022 The Chairman/Managing Director/Chief Executive Officers All banks Master Circular – Scheme of Penalties for bank branches including Currency Chests for deficiency in rendering customer service to the members of public Please refer to the Master Circular DCM (CC) No.G-3/03.44.01/2021-22 dated April 01, 2021 on the scheme of penalties. 2. An updated version on the subject is annexed for information and necessary action. Yours faithfully, (Sanjeev Prakash) Chief General Manager Encl: As above Annex Master Circular - Scheme of Penalties for bank branches including currency chests for deficiency in rendering customer service to the members of public 1. The Scheme of Penalties for bank branches including currency chests has been formulated in order to ensure that all bank branches/ currency chests provide better customer service to the members of public/ linked bank branches keeping in view the objectives of Clean Note Policy and enhancing operational efficiency as part of currency management. 2. Penalties Penalties to be imposed on banks for deficiencies in exchange of notes and coins/remittances sent to RBI/operations of currency chests / replenishment of cash in ATMs etc., are as follows: Sr. No. Nature of Irregularity Penalty i. Shortages in soiled note remittances and currency chest balances For notes in denomination up to ₹50 ₹50/- per piece in addition to the loss. For notes in denomination of ₹100 & above Equal to the value of the denomination per piece in addition to the loss. The recovery of loss and imposition of penalty shall be done immediately on detection of shortage, irrespective of number of pieces. ii. Counterfeit notes detected in soiled note remittances and currency chest balances. Penalty shall be levied in terms of the instructions issued by DCM (FNVD) No.G-1/16.01.05/2022-23 dated April 01, 2022 . iii. Mutilated notes (including deliberately cut notes and built-up notes) detected in soiled note remittances and currency chest balances ₹50/- per piece irrespective of the denomination in addition to the loss. The recovery of loss and imposition of penalty shall be done immediately on detection, irrespective of number of pieces. iv. Non-compliance with operational guidelines by currency chests detected by RBI officials. a) Non-functioning of CCTV, non-compliance with rules/guidelines pertaining to CCTV, recording preservation period and related issues. b) Branch cash/documents kept in strong room (CC’s vault). c) Non-utilization of Note Sorting Machines (NSMs) for sorting of notes (NSMs not used for sorting of high denomination notes, i.e notes of denomination ₹100 and above, received over the counter or not used for sorting notes remitted to chest/RBI) Penalty of ₹5000 for each instance of irregularity. Penalty shall be enhanced to ₹10,000 in case of repetition/ recurrence of irregularity. Penalty shall be levied immediately. v. Violation of any of the terms of agreement with RBI (for opening and maintaining currency chests) or deficiency in service in providing exchange facilities, as detected by RBI officials e.g. a) Non-issue of coins over the counter to any member of public despite having stock. b) Refusal by any bank branch to exchange soiled notes / refusal by any currency chest branch to adjudicate mutilated notes tendered by any member of public. c) Non-conduct of surprise verification of currency chest balances at (i) bimonthly intervals by officials unconnected with the custody of currency chest and (ii) six-monthly intervals by the officials from the Controlling Office. d) Denial of facilities/services to linked branches / linked CCs of other banks. e) Non acceptance of lower denomination notes (i.e. denomination of ₹50 and below) tendered by members of public and linked bank branches. f) Detection by RBI of mutilated /counterfeit notes in re-issuable packets prepared by the currency chest branches. ₹10,000 for any violation of agreement or deficiency of service. ₹5 lakh in case there are more than 5 instances of violation of agreement/deficiency in service by the branch. The levy of such penalty shall be placed in public domain. Penalty shall be levied immediately. vi. Non-replenishment of ATMs Penalty shall be levied in terms of provisions of circular DCM(RMMT) No.S153/11.01.01/2021-22 dated August 10, 2021 , and instructions issued subsequently. 3. Operational Guidelines on levy of penalties 3.1 Competent Authority The Competent Authority to decide the nature of irregularity shall be the Officer-in-Charge of the Issue Department of the Regional Office under whose jurisdiction the defaulting currency chest/bank branch is located. 3.2 Appellate Authority i. Appeal against the decision of the Competent Authority may be made by the Controlling Office of the currency chest/branch to the Regional Director/Chief General Manager/Officer-in-Charge of the Regional Office concerned, within one month from the date of debit , who shall decide whether the same can be accepted/ rejected. ii. Appeals for waiver of penalty made on grounds such as staff being new/untrained, lack of awareness, corrective action having been taken/ shall be taken, etc., shall not be considered. 2026 All Months January February March April May June July August September October November December 2025 All Months January February March April May June July August September October November December 2024 All Months January February March April May June July August September October November December 2023 All Months January February March April May June July August September October November December 2022 All Months January February March April May June July August September October November December 2021 All Months January February March April May June July August September October November December 2020 All Months January February March April May June July August September October November December 2019 All Months January February March April May June July August September October November December 2018 All Months January February March April May June July August September October November December 2017 All Months January February March April May June July August September October November December Archives 2016 All Months January February March April May June July August September October November December 2015 All Months January February March April May June July August September October November December 2014 All Months January February March April May June July August September October November December 2013 All Months January February March April May June July August September October November December 2012 All Months January February March April May June July August September October November December 2011 All Months January February March April May June July August September October November December 2010 All Months January February March April May June July August September October November December 2009 All Months January February March April May June July August September October November December 2008 All Months January February March April May June July August September October November December 2007 All Months January February March April May June July August September October November December 2006 All Months January February March April May June July August September October November December 2005 All Months January February March April May June July August September October November December 2004 All Months January February March April May June July August September October November December 2003 All Months January February March April May June July August September October November December 2002 All Months January February March April May June July August September October November December 2001 All Months January February March April May June July August September October November December 2000 All Months January February March April May June July August September October November December 1999 All Months January February March April May June July August September October November December 1998 All Months January February March April May June July August September October November December 1997 All Months January February March April May June July August September October November December 1996 All Months January February March April May June July August September October November December 1995 All Months January February March April May June July August September October November December 1994 All Months January February March April May June July August September October November December 1993 All Months January February March April May June July August September October November December 1992 All Months January February March April May June July August September October November December 1991 All Months January February March April May June July August September October November December Top Back to previous page More Links : Bank Holidays Banking Glossary Citizen's Charter Complaints Contact Us COVID-19 Measures E-LMS Events FAQs Financial Education Forms IFSC/MICR Codes Important Websites Opportunities @ RBI RBI Clarifications RBI Kehta Hai RBI’s Vision and Values (1257 kb)--> Right to Information Act Tenders Follow RBI RSS Twitter YouTube Instagram Facebook LinkedIn © Reserve Bank of India. All Rights Reserved. Sitemap | Disclaimer Website owned and managed by Reserve Bank of India. Contact us on helpdoc[at]rbi[dot]org[dot]in Website last updated date: Jul 27, 2026 Supports: Google Chrome 147+ | Firefox 150+ | Microsoft Edge Version 147+ | Safari 17+ Accessibility Statement | Screen Reader and Accessibility Help

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2022-23/04 · issued 01 Apr 2022. The plain-English explanation above is BankPulse’s own independent summary.

🖨 Print / Save as PDF 🔗 Copy link☆ Save for later