Friday, 03 December 2021

 

 

 

RBI asks HDFC to temporarily stop issuing new credit cards

Web Admin

Web Admin

5 Dariya News

Mumbai , 03 Dec 2020

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 RBI's order  dated December 2 comes after outages in the bank's online facilities or payment utilities occurred over the past 2 years, including the recent incident in the internet banking and  payment system on November 21, due to a power failure in the primary data centre.In a regulatory filing, HDFC Bank on Thursday said: "The RBI vide said 'Order' has advised the  Bank to temporarily stop i) 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 (ii) sourcing of new credit card customers. In addition, the Order states that the Bank's Board examines the lapses and fixes  accountability."Furthermore, the filing said that these measures shall be considered for lifting upon satisfactory compliance with the major critical observations as identified by the  RBI."The Bank over the last two years 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 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.

"HDFC also said these measures will not materially impact its overall business.In a letter to its customers, the bank's MD & CEO Sashi Jagdishan said: "We take this opportunity to  assure our existing customers that there is no reason to worry. You can continue to transact with the bank without any concern.""We realise that as our valued customer, you  expect us to maintain a very high standard of service quality and experience. And sometimes, we have not been able to live up to your expectations. For that, please accept our  sincere apologies."He pointed out that there were two outages, one in November 2018 and second one in December 2019."We have taken help of external expertise, understood  what needs to be done further and have substantially implemented the inputs to strengthen our IT infrastructure and systems," he said."Unexpectedly another incident happened  on Nov 21, 2020 and the primary reason for the same is the power outage in our 'Primary Data Centre'. We are working on war footing to strengthen this area also now."Besides,  Jagdishan said that some of the bank's strategic digital initiatives to improve the 'front end digital experience, improve digital origination, straight through processing, next  generation of mobile and internet banking, APIs based banking on the edge etc' would now be readied and launched post the approval and clearance from regulator."We will work  with the experts and the regulator to fortify the identified areas for improvement," he said."Internally, we are looking at this as an opportunity to further improve ourselves and  emerge stronger."

 

Tags: RBI , Reserve Bank of India , HDFC Bank

 

 

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