Reserve Bank of India (RBI) said on Friday it has imposed a monetary penalty of Rs 57.50 lakh on Indian Overseas Bank for non-compliance with certain directions of the central bank.
Indian Overseas Bankfailed to report certain instances of frauds involving ATM card cloning and skimming to RBI within three weeks from the date of detection, the central bank said in a notification.
The bank also linked certain floating rate loans to micro and small enterprises, extended by it on or after October 1, 2019, to MCLR or base rate instead of an external benchmark.
In response to these violations, a show cause notice was issued to the bank, asking it why a penalty should not be imposed on it for failure to comply with the directions issued by RBI.
"After considering the bank's reply to the notice and examination of additional submissions made by it, RBI came to the conclusion that the charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty, to the extent of non-compliance with such directions," the RBI said.