The Reserve Bank of India (RBI) is likely to adopt a zero tolerance policy to violations of know your customer/anti-money laundering (KYC/AML) norms by banks, according to reports.
RBI could also impose operational curbs like not allowing a bank to disburse loans for a period of three months or not allowing them to take part in treasury operations for a limited time period. Also, restrictions can be imposed on branch expansion.
The monetary penalty, which is Rs 5 lakh per violation, can also be increased.
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