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RBI asks HDFC to temporarily stop issuing new credit cards

RBI asks HDFC to temporarily stop issuing new credit cards
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RBI asks HDFC to temporarily stop issuing new credit cards

Highlights

The Reserve Bank has asked HDFC Bank to temporarily stop all launches of the 'Digital Business generating activities and sourcing of new credit card customers.

The Reserve Bank of India has asked country's largest private bank, HDFC, to stop new digital business launches and avoid adding new Credit Card customers after repeated reports by its customers facing multiple cases of technical glitches.

HDFC Bank said in a regulatory filing that 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.

It added the RBI vide said Order has advised the Bank to temporarily stop i) all launches of the Digital Business generating activities planned under its program ‐ Digital 2.0 (to be launched) and other proposed business generating IT applications and (ii) sourcing of new credit card customers. Besides, the Order states that the Bank's Board examines the lapses and fixes accountability.

HDFC Bank said 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 would continue to engage with the regulator in this regard.

The bank has said that it has always endeavoured to provide seamless digital banking services to its customers. The Bank has been taking conscious, concrete steps to remedy the recent outages on its digital banking channels and assures its customers that it expects the current supervisory actions will have no impact on its existing credit cards, digital banking channels and existing operations. The Bank believes that these measures will not materially impact their overall business.

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