The Reserve Bank of India (RBI) has fined Hongkong and Shanghai Banking Corporation (HSBC) ₹31.8 lakh for not following some rules properly. The bank did not follow proper procedures to manage and track unused accounts and unclaimed money, making it difficult for customers and regulators to monitor these funds.
The bank failed to follow some important rules, such as:
- The bank failed to properly manage inactive accounts (accounts that have not been used for a long time) and unclaimed deposits (funds left untouched in accounts). It did not provide a searchable list of unclaimed deposits on its website, making it difficult for customers to check whether any of their money remains unclaimed.
- In addition, the bank did not assign a Unique Deposit Reference Number (UDRN) to some unclaimed deposits, which is important for tracking and identifying these funds easily.
How did RBI find this?
- RBI checked the bank’s records through an official inspection based on its financial position as of March 31, 2025.
- After finding issues, RBI sent a notice to the bank.
- The bank responded and explained its side, but RBI was not satisfied and confirmed the mistakes.
The penalty has been imposed only for non-compliance with regulatory rules. It does not mean that customers have lost any money or that any of the bank’s transactions are invalid. However, the RBI may take further action in the future if necessary.
