RBI partially lifts ban on HDFC Bank after 9 months, allows issuance of new credit cards
The Reserve Bank of India (RBI) on Wednesday eased technology restrictions on HDFC Bank in the form of a 9-month penalty due to technical glitches. The central bank has allowed the private lender to issue new credit cards. However, the RBI said its temporary ban on the lender for launching new, digital initiatives continues, the report said.
The Reserve Bank of India had issued orders to HDFC Bank in December and February on certain incidents in the bank’s internet banking/mobile banking/payment utilities in the last two years.
“As a further update to the above information, we would like to inform you that the RBI vide its letter dated August 17, 2021, has relaxed the restrictions imposed on sourcing of new credit cards,” it said in a regulatory filing. Said.
The Board of Directors of the Bank has taken note of the above letter of RBI.
HDFC Bank said the ban on all new launches of digital business generating activities planned under Digital 2.0 will continue till further review by RBI.
“We will continue to engage with the RBI and ensure compliance on all parameters,” the bank said. HDFC Bank’s stock was trading 2.06 per cent higher at Rs 1,546.00 on the BSE.
HDFC Bank managing director and chief executive officer Shashidhar Jagadeesan said a month ago on July 17 that the bank has complied with 85 per cent of RBI’s queries on technology. He also said that RBI’s ban on new digital launches on technical issues has affected business and it is now in the regulator’s court to lift the ban on issuance of new credit cards.
“We have given the regulator a milestone of what we are doing on technology, following their advice and instructions. We have covered a very important part while speaking. About 85 percent of what we had to do has been covered,” Jagadeesan, who has been with the lender for over two decades and acted as a ‘change agent’ over the years that led to his promotion, said.
In December last year, the RBI barred HDFC Bank from launching any new digital products or services and issuing new credit cards until technical issues are resolved by the bank. HDFC was banned by the central bank as a penalty for repeated incidents of outages in its online platform.
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