What specific violation led to this penalty?

The bank sanctioned loans to relatives of its directors, which violated RBI's directions on 'Loans and Advances to Directors, their Relatives, and Firms/Concerns in which they are Interested'.

What legal provisions were used to impose the penalty?

The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.

Does this penalty affect the validity of the loans already sanctioned?

No, the RBI clarified that the penalty is for regulatory non-compliance and does not pronounce on the validity of any transaction or agreement with customers.

Home › Circulars › RBI press release 62966

RBI fines Nashik co-op bank ₹2.1 lakh for director-relative loans

We are re-checking the exact figures on this page against the official RBI text. Until that is done, please rely on the official RBI source cited below.

Source: Reserve Bank of India · Press Release prid 62966 · ~2 min read

RBI imposed a ₹2.1 lakh penalty on The Nasik Road Deolali Vyapari Sahakari Bank Ltd. for violating loan norms to directors' relatives. The action follows a March 2025 inspection and is based on sustained non-compliance with RBI's related-party lending directions.

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Official RBI source: https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=62966 — summary by BankPulse (bankpulse.ai).

RBI fines Nashik co-op bank ₹2.1 lakh for director-relative loans

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