The Reserve Bank of India has ordered HDFC Bank to temporarily stop sourcing of new credit card customers and new digital business launches. The central bank’s order came in view of the recent outages in the bank’s internet banking and payment system.
HDFC Bank has been asked by the RBI to temporarily stop new digital launches and issuing new credit cards to customers. (Photo: Reuters)
The Reserve Bank of India (RBI) has asked HDFC Bank to temporarily stop its new digital business launches and sourcing of new credit cards customers. The private lender disclosed the same in a statement to stock exchanges on December 3, just a day after the RBI’s order.
According to the statement, the RBI’s has issued the instructions with regard to certain incidents of outages in the internet banking/mobile banking/payment utilities of the bank over the past two years, including the recent outages at the bank’s interest banking and payment system on November 21, 2020 due to a power fault in the primary data centre.
“RBI has issued an order dated December 2, 2020, to HDFC Bank Ltd with regard to certain incidents of outages in the internet banking/ mobile banking/ payment utilities of the bank over the past two years, including the recent outages in the bank’s internet banking and payment system on November 21, 2020, due to a power failure in the primary data centre,” the bank said in a regulatory filing.
HDFC Bank said RBI has advised the bank to temporarily stop all launches of digital business generating activities planned under its program Digital 2.0 and sourcing of new credit card customers. The RBI’s order has directed the bank’s board to examine the lapses and fix accountability.
“The above measures shall be considered for lifting upon satisfactory compliance with major critical observations as identified by RBI,” said the lender.
It also said in the statement that HDFC Bank has taken several measures over the last two years to fortify IT systems and “will continue to work swiftly to close out the balance and engage with the regulator in this regard”.
Besides assuring that it is taking concrete steps to fix recent outages on its digital banking channels, HDFC Bank also said that the current supervisory actions will have “no impact on its existing credit cards, digital banking channels and operations”.
“The bank believes that these measures will not materially impact its overall business,” added the bank’s statement.