RBI imposed fine of Rs 1.73 crore on HSBC bank

Tags: Economy/Finance National News

HSBC Bank has been fined Rs 1.73 crore by the Reserve Bank of India (RBI) for violating the Credit Information Companies Rules 2006 (CIC Rules).

An overview of the news

• The central bank has accused the bank of providing false information about its credit cards to credit information companies.

• An investigation by the RBI has revealed that the bank had given wrong information about its expired credit cards as well.

• The RBI has imposed a hefty fine of Rs 1.73 crore on the bank for violating its rules.

• The RBI had inspected the financial position of HSBC Bank as on March 31, 2021, as part of its surveillance checks.

• It was found in the inspection that the bank is not following many rules of RBI related to credit cards.

• RBI has issued a show cause notice to HSBC Bank asking why it did not provide correct information as per CIC norms.

Penalties on two cooperative banks

• Apart from HSBC Bank, RBI has also imposed penalties on two co-operative banks for violation of norms.

• Thrissur Urban Cooperative Bank Ltd has been fined Rs 2 lakh for flouting gold loan norms.

• Bhilai Nagrik Sahakari Bank has been fined Rs 1.25 lakh for not depositing unclaimed deposits in time under the Depositor Education and Awareness Fund Scheme (DEAF Scheme).

About Reserve Bank of India

• RBI was established on April 1, 1935 as per the provisions of the Reserve Bank of India Act, 1934.

• It started functioning from 1 April 1935.

• The central office of the Reserve Bank was established in Kolkata which was permanently shifted to Mumbai in the year 1937.

• It was nationalized in 1949 and now the government of India is the owner of RBI.

• It has the power to regulate Banks under the Banking Regulation Act 1949.

• It has the power to regulate the Non-Banking Financial Company (NBFC) under the RBI act 1934.

• RBI is also the regulator of the digital payment system under the Payment and settlement act 2007.

• Before independence till 1942 RBI used to issue currency not only for India but also for Myanmar which was then known as Burma. However, it was discontinued after 1947.

• Headquarters of RBI: Mumbai 

• Governor of RBI : Shaktikanta Das