The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹1.72 crore on the State Bank of India (SBI) for violating certain regulatory guidelines related to loans, customer protection, and current account operations.
According to an official statement released by the RBI, the penalty was imposed following the findings of a supervisory inspection (ISE 2023) conducted based on SBI’s financial position as of March 31, 2023. The inspection revealed that SBI had not complied with several key directions issued by the central bank.
“The Reserve Bank of India (RBI) has, by an order dated April 29, 2025, imposed a monetary penalty of ₹1,72,80,000 (Rupees One Crore Seventy Two Lakh Eighty Thousand only) on State Bank of India (the bank) for non-compliance with certain directions issued by RBI on ‘Loans and Advances- Statutory and Other Restrictions’, ‘Customer Protection – Limiting Liability of Customers in Unauthorised Electronic Banking Transactions’ and ‘Opening of Current Accounts by Banks – Need for Discipline’,” RBI said.
The violations include the extension of a bridge loan to an entity against pending reimbursements or subsidies from the Central or State Government — a practice restricted under RBI norms. Additionally, the bank failed to credit the amount involved in unauthorised electronic transactions to some customer accounts within the mandated period of 10 working days. In some cases, SBI also did not compensate customers within 90 days of receiving complaints about such transactions.
Further, the bank was found to have opened or maintained certain current accounts in violation of RBI’s rules intended to ensure financial discipline and prevent misuse.
After reviewing SBI’s response to a show-cause notice and considering both written and oral submissions from the bank, the RBI concluded that the charges were valid and warranted the imposition of the penalty. The action has been taken under the powers granted to the RBI by the Banking Regulation Act, 1949.
The central bank clarified that this penalty relates specifically to deficiencies in regulatory compliance and does not affect the validity of any individual transactions or customer relationships. RBI also noted that further action may be taken if deemed necessary.
