1 day ago
The Reserve Bank of India (RBI) has imposed a penalty of ₹38.60 lakh on IDFC First Bank for non-compliance with provisions under its Know Your Customer (KYC) norms, the lender confirmed the RBI action in an exchange filing. According to the RBI, the penalty was levied for lapses related to certain current accounts opened by the bank in violation of the RBI KYC Directions, 2016.
"Reserve Bank of India (‘RBI’) vide its communication dated April 17, 2025, has imposed a monetary penalty of ₹38.60 lakh (Rupees Thirty-Eight Lakh Sixty Thousand) on the Bank. The subject penalty is imposed due to non-compliance with specific provisions contained in Reserve Bank of India - Know Your Customer (KYC) Directions 2016, pertaining to certain current accounts opened by the Bank."
The action was taken under Section 47A(1)(c) read with Section 46(4)(i) of the Banking Regulation Act, 1949, which empowers the RBI to take enforcement action against regulated entities for regulatory breaches.
In response, IDFC First Bank
stated that it has conducted a thorough internal review and already implemented corrective measures to strengthen its KYC processes. The bank emphasised that the issue was procedural and added that there would be no material impact on its operations or day-to-day banking activities apart from the financial penalty.
"We have taken necessary preventive actions to enhance our compliance framework and avoid such occurrences in the future," the bank noted in its exchange filing.
Meanwhile, earlier IDFC First Bank Managing Director and CEO V Vaidyanathan told CNBC-TV18 that the lender’s balance sheet will double over the next four years.
This optimistic outlook follows a substantial ₹7,500 crore capital infusion from affiliates of Warburg Pincus and the Abu Dhabi Investment Authority (ADIA). The fresh capital is expected to strengthen the bank’s capital adequacy ratio, which Vaidyanathan said would increase from the current 16.5% to nearly 19%.
“We are well-capitalised and ready for the next phase of growth,” Vaidyanathan noted, highlighting the bank’s strategic focus on expanding its core lending operations. The newly raised capital will be primarily deployed to support growth in IDFC First Bank’s retail and MSME (micro, small, and medium enterprises) lending segments, which remain central to its long-term strategy.
