The Reserve Bank of India on Thursday imposed several restrictions on HDFC Bank’s digital business, in the wake of several outages in internet and mobile banking operations at the country’s largest private bank in the last two years.
The central bank order temporarily restricts the bank from all launches of the digital business, including issuing new credit cards.
“The RBI vide said order has advised the bank to temporarily stop all launches of the digital business-generating activities planned under its programme–Digital 2.0 (to be launched) and other proposed business-generating IT applications and sourcing of new credit card customers,” the bank said.
The RBI order comes in the backdrop of several issues the lender has faced in the past couple of years in its internet banking and mobile banking as well as its payment utilities.
In the latest instance, an unexpected outage at one of its datacentres had impacted HDFC Bank’s digital services on November 21. Irate customers had taken to social media like Twitter complaining of unavailability of internet banking and payment services like UPI (Unified Payments Interface).
The RBI wants HDFC Bank’s board to examine the lapses and fix the accountability.
It further stated that the measures shall be considered for lifting upon satisfactory compliance with the major critical observations as identified by the RBI.
HDFC Bank said that over the last two years it has taken several measures to fortify its IT systems and will continue to work swiftly to close out the balance and continue to engage with the regulator in this regard.
The measures are also unlikely to have any material impact on its overall business, it added.
HDFC Bank shares were down 0.8 per cent at Rs 1,395.70 in late-morning trading on the BSE on Thursday. The benchmark Sensex was up 80 points or 0.2 per cent at 44,698.46.