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The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹29.60 lakh on Fino Payments Bank Limited. The fine was issued on June 6, 2025, because the bank failed to follow certain rules under RBI’s guidelines related to the Licensing of Payments Banks.
RBI used its legal powers under Section 47A(1)(c) and Section 46(4)(i) of the Banking Regulation Act, 1949 to impose this penalty. These sections allow RBI to take action against banks that do not comply with its instructions.
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Reason Behind the Penalty
RBI conducted a regular inspection called the Statutory Inspection for Supervisory Evaluation (ISE 2024) to review the bank’s operations as of March 31, 2024. During the inspection, RBI found that the bank had repeatedly exceeded the allowed end-of-day balance limit in certain accounts. This is a violation of rules that apply specifically to payments banks, which are required to maintain a ceiling on the amount of funds that can be held in customer accounts at the end of each day.
RBI’s Process Before Imposing the Fine
After detecting the violation, RBI sent a show-cause notice to the bank, asking why a penalty should not be imposed. The bank was given a chance to respond in writing and also make oral submissions during a hearing. After reviewing all the responses, RBI found that the bank had indeed broken the rules and decided to impose the penalty.
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Clarification from RBI
RBI has clearly stated that this penalty is based only on the bank’s failure to follow regulatory rules. It does not affect or question the validity of any transactions or agreements made by the bank with its customers. RBI also mentioned that this penalty does not prevent it from taking any further action against the bank if needed in the future.
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