Mumbai, India – The Reserve Bank of India (RBI) has imposed monetary penalties on Citibank N.A. and IDBI Bank Ltd. for regulatory violations concerning transaction reporting and due diligence on remittances.

Citibank N.A. has been fined Rs 36.28 lakh for non-compliance with transaction reporting guidelines under the Liberalised Remittance Scheme, while IDBI Bank Ltd. faces a penalty of Rs 36.30 lakh for inadequate due diligence in processing inward remittances from a foreign currency account.

In an official statement issued on Friday, the RBI stated that the penalties were levied due to deficiencies in regulatory compliance. The central bank clarified that these fines do not impact the validity of customer transactions or agreements with the banks.

The action underscores RBI’s commitment to enforcing compliance standards in India’s banking sector.

The RBI’s findings revealed that Citibank failed to adhere to transaction reporting norms, which are essential for maintaining transparency and regulatory oversight in cross-border financial activities.

Similarly, IDBI Bank’s lapses in due diligence raised concerns over the monitoring of foreign currency transactions, highlighting the need for stricter compliance measures.

While these penalties serve as a warning to financial institutions, the RBI reiterated that the objective is to ensure adherence to regulatory norms rather than questioning the legitimacy of customer dealings.

Banks are expected to enhance their compliance frameworks to avoid such violations in the future.