The central government may consider increasing the penalty for banks if they do not follow the regulatory guidelines. A senior government official informed that the government may review the regulatory system in this regard, for which the Banking Regulation (BR) Act 1949 and the Reserve Bank of India (RBI) Act 1934 can be amended.
The official said on the condition of anonymity that at present the penalty amount is very low. We will discuss this with the regulator and consider the possibilities of amending the provisions. In the current system, the Reserve Bank can impose a penalty under other provisions including Section 46 and 47A of the BR Act, which is imposed on violation of regulatory guidelines. ( PLC & GT )
