The Reserve Bank of India (RBI) has penalised Punjab National Bank, Federal Bank, Kosamattam Finance and Mercedes-Benz Financial Services India for violating certain regulatory norms.

The central bank has imposed a penalty of Rs 72 lakh on state-owned Punjab National Bank, Rs 30 lakh on private lender Federal Bank, Rs 13.38 lakh on Kosamattam Finance and Rs 10 lakh on Mercedes-Benz Financial Services.

Punjab National Bank was fined for non-compliance with certain provisions related to ‘interest-rate on advances’ and ‘customer service in banks’, RBI said in a release. The violations included levying SMS charges on certain accounts despite maintaining invalid mobile numbers in the Core Banking Solution (CBS), not strictly adhering to the interest rates as per the pre-disclosed schedule in several term deposit accounts, and failing to specify the interest reset date in MCLR-linked loans.

Federal Bank was fined for issuing demand drafts, each valued at Rs 50,000 and above, without including the name of the purchaser on the face of the drafts.

Kosamattam Finance was penalised for not maintaining a loan-to-value (LTV) ratio of 75% in certain loan accounts during the fiscal year 2021-22. 

Mercedes-Benz Financial Services India (formerly known as Daimler Financial Services India) was fined for failing to conduct ongoing due diligence of its customers and for not updating the Know Your Customer (KYC) information of its high-risk customers as of 31 March 2021.

In all cases, the RBI said penalties are based on deficiencies in regulatory compliance and are not intended to pronounce upon the validity of any transaction or agreement entered into by the entities with their customers.