📄 Source: Reserve Bank of India · Press Release prid 63132
Quick answerRBI fined The Chikhli Urban Co-operative Bank ₹13 lakh for failing to transfer unclaimed amounts to the Depositor Education and Awareness Fund, sanctioning loans to builders for land acquisition, and lacking robust software for suspicious transaction reporting.
What changed
RBI imposed a monetary penalty of ₹13 lakh on The Chikhli Urban Co-operative Bank Limited, Chikhli, Maharashtra, for contravention of Section 26A of the BR Act and non-compliance with directions on housing finance and KYC.
What it means for you
Co-operative banks must comply with statutory provisions on depositor funds, housing finance restrictions, and KYC software requirements. Non-compliance invites financial penalties.
The rule, in the simplest words
RBI fined The Chikhli Urban Co-operative Bank ₹13 lakh for three violations: failure to transfer unclaimed deposits to the Depositor Education and Awareness Fund, sanctioning loans to builders for land acquisition, and lacking robust software for suspicious transaction reporting.
The penalty was based on a statutory inspection as of March 31, 2025.
The action is for statutory and regulatory deficiencies, not a judgment on customer transactions.
How it plays out — a real example
Ravi, the compliance officer at a co-operative bank, reads this penalty notice and immediately schedules a review of his bank's unclaimed deposit transfers, housing loan policies, and suspicious transaction reporting software.
What you must do
Ensure timely transfer of unclaimed deposits to the Depositor Education and Awareness Fund.
Avoid sanctioning loans to builders for land acquisition unless permitted.
Implement robust software for effective identification and reporting of suspicious transactions.
Review KYC compliance processes.
Who it affects
The Chikhli Urban Co-operative Bank Limited
Why was the penalty imposed?
For failing to transfer unclaimed amounts to the Depositor Education and Awareness Fund, sanctioning loans to builders for land acquisition, and lacking robust software for suspicious transaction reporting.
What is the penalty amount?
₹13 lakh.
Does this affect other co-operative banks?
The source does not state this; it applies to the specific bank.
Test yourself
Quick self-check built only from the facts already on this page — tap a question to reveal the answer.
Q1. In one line, what does this circular do?
RBI fined The Chikhli Urban Co-operative Bank ₹13 lakh for failing to transfer unclaimed amounts to the Depositor Education and Awareness Fund, sanctioning loans to builders for land acquisition, and lacking robust software for suspicious transaction reporting.
Q2. Who does this circular apply to?
The Chikhli Urban Co-operative Bank Limited
Q3. What is the first thing you should do about it?
Ensure timely transfer of unclaimed deposits to the Depositor Education and Awareness Fund.
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
Implement robust software for effective identification and reporting of suspicious transactions.
📜 Compliance
Ensure timely transfer of unclaimed deposits to the Depositor Education and Awareness Fund.
Avoid sanctioning loans to builders for land acquisition unless permitted.
Review KYC compliance processes.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Compliance officer at a bank this circular applies to (The Chikhli Urban Co-operative Bank Limited), your first concrete step on “RBI Penalty on Chikhli Urban Co-operative Bank for KYC, Housing Finance, and Depositor Fund Violations” is: “Ensure timely transfer of unclaimed deposits to the Depositor Education and Awareness Fund.”.
Circular: https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=63132 -- RBI Penalty on Chikhli Urban Co-operative Bank for KYC, Housing Finance, and Depositor Fund Violations
Issued: 13 Jul 2026, 17:46 IST
Action required: Ensure timely transfer of unclaimed deposits to the Depositor Education and Awareness Fund.
Action required: Avoid sanctioning loans to builders for land acquisition unless permitted.
Action required: Implement robust software for effective identification and reporting of suspicious transactions.
Action required: Review KYC compliance processes.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
AI-drafted · AI fact-check pending · under the editorial review of our expert review panel · decoded & published by BankPulse · 13 Jul 2026, 17:46 IST
Official RBI source: https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx?prid=63132 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert review panel. Independent platform, not affiliated with the Reserve Bank of India; never reproduces RBI text verbatim.
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