RBI slaps Bank of Baroda, GIC Housing Finance with ₹66.7 lakh penalty for non-compliance — Here's all you need to know

The Reserve Bank of India (RBI) has slapped the Bank of Baroda and GIC Housing Finance with a combined penalty of ₹66.7 lakh for non-compliance to its fair practices code for lenders and KYC guidelines.

The banking industry regulator noted that both these 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 (Bank of Baroda and GIC Housing Finance) with their customers. This means that the fines are not imposed on customers or particular transactions, but the entities themselves.

Here's what we know about both cases:

₹63.6 lakh penalty on Bank of Baroda: What we know

The central bank in a statement on 3 July said it has imposed a ₹63.6 lakh penalty on public sector lender the Bank of Baroda (BoB) for non-compliance with certain provisions of the ‘Fair Practices Code for Lenders’ and its ‘Know Your Customer (KYC)’ norms.

The RBI added that it conducted a statutory inspection for supervisory evaluation of the Bank of Baroda with reference to the financial position as on 31 March 2025 and discovered the non-compliances, after which a notice was issued to the lender.

Following the bank's response and due consideration of the same, the banking regulator found that the Bank of Baroda:

• Had collected interest higher than the contracted rate of interest in certain loan accounts.
• Did not upload KYC records of certain customers to the Central KYC Records Registry (CKYCR) within the prescribed timeline, the RBI said.

₹3.1 lakh penalty on GIC Housing Finance: See details

Further, in a separate statement, the RBI also said that it has imposed a penalty of ₹3.1 lakh GIC Housing Finance for non-compliance with certain provisions of the central bank's KYC guidelines.

As per the banking regulator's release, a statutory inspection of the on non-banking financial company (NBFC) was conducted by the National Housing Bank with reference to its financial position as on 31 March 2025. In this case too, a notice was issued.

The statement said that GIC Housing finance failed to put in place a system of periodic review of risk categorisation of accounts, with such periodicity being at least once in six months. The penalty was imposed due to this failure, the RBI added.

Canara Bank, BoB, Indian Bank pay ₹7,023 crore dividend to govt

Earlier this week, PTI reported that Canara Bank, BoB and Indian Bank together paid a dividend of ₹7,023 crore to the government for FY26 on Monday (29 June).

• Canara Bank MD and CEO Brajesh Kumar Singh presented a dividend cheque of ₹2,397 crore to Finance Minister Nirmala Sitharaman. The PSB declared a dividend of ₹4.2/share, representing 210% of the face value of ₹2 each for FY26.
• BoB's MD and CEO, Debadatta Chand, presented a dividend cheque of ₹2,811 crore to Sitharaman. For FY26, the bank declared a dividend of ₹8.50/share, representing 425% of the face value of ₹2 each.
• Indian Bank's MD and CEO Binod Kumar handed over a dividend cheque of ₹1,815.05 crore to the finance minister.

(With inputs from PTI)