Reserve Bank of India imposes monetary penalty on IndusInd Bank Limited
The Reserve Bank of India (RBI) has, by an order dated August 14, 2026, imposed a monetary penalty of ₹59.20 lakh (Rupees Fifty-Nine lakh twenty thousand only) on IndusInd Bank Limited (the bank) for non-compliance with certain provisions of directions issued by RBI on ‘Interest Rate on Deposits’ and ‘Securitisation of Standard Assets’. This penalty has been imposed in exercise of powers…
On August 14, 2026, the Reserve Bank of India (RBI) imposed a penalty of ₹59.20 lakh on IndusInd Bank Limited for failing to adhere to certain RBI directives. The penalty was issued in accordance with Section 47A(1)(c) and Section 46(4)(i) of the Banking Regulation Act, 1949. The RBI conducted a statutory inspection of the bank's financial position as of March 31, 2025, to evaluate its compliance.
Following the findings of non-compliance with the RBI's directions, the bank was issued a notice requesting a response explaining why the penalty should not be imposed.
After reviewing the bank's reply, additional submissions, and oral arguments during a personal hearing, the RBI concluded that the bank was found guilty of two charges: (i) paying interest on deposits held in certain current accounts, and (ii) engaging in activities similar to synthetic securitisation. The RBI's action is focused on regulatory compliance deficiencies and does not evaluate the validity of any transactions or agreements between the bank and its customers.
However, the monetary penalty is not intended to prejudice any other potential actions the RBI may take against the bank in the future.
Written by urgent.news from Reserve Bank of India's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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