1. Key Details
| Regulated Entity: | Dr. Panjabrao Deshmukh Urban Cooperative Bank Ltd., Amravati, Maharashtra |
|---|---|
| Penalty Amount: | ₹1.09 Lakh (Rupees One Lakh Nine Thousand) |
| Order Date: | April 2, 2026 (Inspection Position: March 31, 2025) |
| Primary Violations: |
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2 Root Cause Analysis (RCA)
- System Parameter Misconfiguration: The Core Banking System (CBS) was likely not updated promptly to reflect the latest RBI circulars regarding maximum permissible caps on NEFT customer charges.
- Lack of Automated Hard-Stops: The treasury or investment management module lacked real-time, automated hard-stop alerts to prevent trade execution once single-counterparty exposure limits for non-SLR instruments were reached.
- Oversight Gap: Manual reliance for tracking exposure limits and transaction fee validations, leading to human error and failure to detect the breaches prior to the RBI statutory inspection.
3 Preventive Controls
System-Level Guardrails
Configure CBS parameters to strictly cap NEFT fees. Implement hard system limits in treasury software to block any non-SLR investment that breaches single-party thresholds.
Maker-Checker Framework
Enforce a strict Maker-Checker process for updating any fee structures or limit configurations within the banking software.
4 Lessons Learnt
- Regulatory Agility is Mandatory: Changes in RBI guidelines (like NEFT fee rationalization) must trigger immediate IT change-management workflows.
- Automation over Manual Tracking: Relying on manual calculations for complex prudential norms (like non-SLR exposures) introduces high regulatory risk.
- Proactive Concurrent Audit: Internal and concurrent auditors must specifically test IT parameter configurations and exposure limits regularly, rather than waiting for the annual statutory inspection to uncover them.