Reserve Bank Of India Imposes Monetary Penalty On UCO Bank.

Mumbai; February 2026: The Reserve Bank of India (RBI) has, by an order dated 16th February 2026, imposed a monetary penalty of Rs. 38.60 lakhs (Rupees Thirty Eight Lakh Sixty Thousand only) on UCO Bank (the bank) for non-compliance with certain directions issued by RBI on ‘Periodicity of payment of interest on savings deposits’, ‘Locker Rent’ and ‘Credit Information Reporting in respect of Self Help Group (SHG) members’. 

This penalty has been imposed in exercise of powers conferred on RBI under the provisions of section 47A(1)(c) read with section 46(4)(i) and 51(1) of the Banking Regulation Act, 1949 and section 25(1)(iii) read with section 23(4) of the Credit Information Companies (Regulation) Act, 2005.

The Statutory Inspection for Supervisory Evaluation (ISE 2025) of the bank was conducted by RBI with reference to its financial position as on March 31, 2025. Based on supervisory findings of non-compliance with the provisions of RBI directions and related correspondence in that regard, a notice was issued to the bank advising it to show cause as to why penalty should not be imposed on it for its failure to comply with the said provisions of RBI directions.

After considering the bank’s reply to the notice and additional submissions made by it, RBI found that the following charges against the bank were sustained, warranting imposition of monetary penalty:

• The bank did not pay any interest on certain Savings Bank Deposit accounts;

• The bank did not report credit related Self Help Group member level data to Credit Information Companies; and

• The bank did not refund the proportionate amount of advance locker rent collected in case of premature surrender of locker by certain customers.

This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers. Further, imposition of monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank.

Team Maverick.