Reserve Bank of India (RBI) said Friday it has imposed a fine of Rs 57.50 lakh on Indian Overseas Bank for failing to comply with certain central bank guidelines.
Indian Overseas Bank failed to report certain cases of fraud related to ATM cloning and skimming to RBI within three weeks of the date of detection, the central bank said in a statement.
The bank also linked certain variable rate loans to micro and small businesses, which they extended on or after October 1, 2019, to MCLR or base rate rather than an external benchmark.
In response to these violations, a show cause notice was sent to the bank asking why it should not be fined for failing to comply with RBI’s instructions.
“After reviewing the Bank’s response to the notification and examining additional comments submitted by it, RBI concluded that the allegation of non-compliance with the above RBI instructions was well founded and justified the imposition of a fine, for to the extent of non-compliance with such guidelines,” the RBI said.