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The Reserve Bank of India (RBI) has once again adopted a strict stance regarding banking rules. This time the Central Bank’s attack has fallen on the big and reliable public sector Canara Bank. RBI has imposed a heavy fine of Rs 41.8 lakh on Canara Bank for ignoring the rules. If you also have an account in this bank, then this news is very important for you. RBI made it clear in a statement issued on Friday that this action has been taken due to some serious deficiencies found in the functioning of the bank, the biggest negligence of which is to KYC (Know Your Customer) of customers and inoperative accounts.

Major negligence of the bank came to light in the investigation

In fact, RBI had closely inspected Canara Bank (ISE 2025) based on its financial position till March 2025. During this investigation, the central bank came to know that Canara Bank had not uploaded the KYC records of many of its customers to the ‘Central KYC Records Registry’ (CKYCR) within the stipulated time limit. Let us tell you that KYC process is the most important part in the banking system, which not only confirms the identity of the customers but also helps in keeping an eye on any kind of suspicious financial activity. In such a situation, RBI does not tolerate any laxity in this process.

There was an error in closing or deactivating accounts.

Not only this, another major negligence of the bank has been exposed in the inspection of RBI. Ignoring the rules, the bank had declared the accounts of some customers as ‘inoperative’, whereas the truth was that not even a year had passed since the last transaction by the customers in those accounts. This is completely against the guidelines set by RBI. Banking sector experts say that due to such arbitrariness and mistakes of the bank, common customers not only have to face huge inconvenience, but it also affects the entire banking system.

Another company fined, fined

Not only Canara Bank has come under this strict action of RBI, but the central bank has also taken strict action against another financial company ‘Puraan Associates Private Limited’. This company has been accused of not following important instructions to asset classification, due to which a fine of Rs 3.1 lakh has been imposed on the company.

Will there be any impact on customers’ money?

After this big news comes out, it is natural for Canara Bank customers to feel scared, but RBI has made the situation absolutely clear in this matter. The central bank has clearly said that the purpose of this fine is only to curb the violation of regulatory rules. This does not at all mean that the customers’ money deposited in the bank or that company is unsafe, or that any question is being raised on the validity of any transaction between them. The real objective of this strict step of RBI is to improve the compliance of rules in banks so that the banking system of the country remains completely transparent, safe and trustworthy for the general public.