RBI Bars HDFC Bank From Acquiring New Credit Card Customers, Digital Launches

These strictures come on the back of several instances of technical glitches and outages on internet banking, mobile banking over the last two years

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The Reserve Bank of India has directed HDFC Bank to temporarily stop sourcing new credit card customers and all digital business launches under its Digital 2.0 initiative.

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These strictures come on the back of several instances of outages on internet banking, mobile banking over the last two years.

The private bank said in a statement that the RBI has issued an order dated Dec. 2, 2020, “with regard to certain incidents of outages in 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 Nov. 21, 2020, due to a power failure in the primary data centre.”

The central has asked HDFC to temporarily stop “all  launches of digital business generating activities planned under its program Digital 2.0, other proposed business generating IT applications and sourcing of new credit card customers.”

The country’s largest private bank had recently faced outages in its internet banking and payment system on November 21 this year due to a power failure in its primary data centre.

Last year in December, HDFC’s customers had reported disruption in digital payments services for two consecutive days that resulted in default in EMI and credit card bill payments for some users. The bank had quoted ‘a technical glitch’ the issue behind the disruption.

Prior to that, the bank had launched its net-banking app which gathered strong criticism for its various technical glitches, forcing the bank to rollback the app.

RBI in its order has directed the bank’s board to examine the lapses and fixes accountability.