RBI PUTS BREAKS ON HDFC CREDIT CARDS

RBI Puts Breaks On HDFC Credit Cards

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The Reserve Bank of India has asked HDFC Bank to suspend the launches of new digital business activity and not add any new Credit card customers following the outage at its data center which impacted their operations last month. The Lender has also asked the bank’s board to examine the loopholes and fix the accountability. India’s largest private bank informed the stock exchange on Wednesday that the order from the RBI was issued on 2nd December and was done in response to the outages in the bank’s internet banking/mobile banking and payment utilities over the past two years. The most recent outage took place on 21st November after a lot of customers could not access their digital banking. HDFC blamed it on a power cut in their primary data center.

RBI STATEMENT

“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 center,” HDFC Bank said in a regulatory filing.

HDFC Bank said the RBI order “has advised the bank to temporarily stop all launches of the digital business-generating activities planned under its program Digital 2.0 and other proposed business generating IT applications and sourcing of new credit card customers”.

In addition to this , the order has directed the bank board to examine the lapses and fixes accountability, HDFC Bank added.

Measure

The bank said that the measures will be considered for lifting upon satisfactory compliance with many major critical observations as recognized by the RBI. HDFC bank said “ over the last two years, it has taken several measures to fortify its ITsystems 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 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 its overall business,” it added.

This has come at a time when the whole banking system in India is trying to revive itself after long break after the lockdown. During the lockdown, the whole banking system had to work remotely and manage finances in way that it does not affect the overall progress. Now, we’ll have to wait and see how this is going to have an impact on the private bank.

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