The Reserve Bank of India ( RBI ) fined the Bank of Maharashtra Rs. 31.80 lakh for not following the rules properly while opening bank accounts using Aadhaar-based OTP (one-time password) e-KYC in cases where the customer was not physically present.
This penalty was based on RBI’s findings during a detailed inspection of the bank’s operations for the financial year ending March 31, 2024. RBI pointed out that the bank had failed to comply with some of its guidelines related to digital account opening using Aadhaar. These rules are meant to ensure security and identity verification, especially when customers open accounts online or remotely, without visiting a branch.
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The fine was officially communicated to the bank through a letter dated May 2, 2025. It was issued under the Banking Regulation Act, 1949, which gives the RBI the authority to take action when banks do not follow regulatory directions.
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In response, the Bank of Maharashtra stated that it has taken the RBI’s concerns seriously and has already started taking steps to fix the issue and make sure it doesn’t happen again. The bank said it is putting in place better checks and internal controls to stay in full compliance with RBI rules in the future.
The financial penalty of Rs. 31.80 lakh may not be large for a public sector bank, but the issue is still important. It highlights that the RBI is closely watching how banks use digital technologies, especially for things like online KYC and account opening.
Bank of Maharashtra’s stock (NSE: MAHABANK, BSE: 532525) closed slightly lower. The share price ended at Rs. 50.63, down Rs. 0.07 (-0.14%) from the previous day’s close of Rs. 50.66. The stock reached a high of Rs. 51.58 and a low of Rs. 50.35 during the trading session, with a VWAP (Volume Weighted Average Price) of Rs. 50.84.
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