RBI asks HDFC Bank to temporarily stop issuing new credit cards

Mumbai, December 3

Advertisement

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, 2020 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 program – 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.” In addition, the bank said these measures will not materially impact its overall business.

HDFC Bank shares fall over 2 pc

NEWD DELHI: Shares of HDFC Bank declined over 2 per cent on Thursday after the company said the Reserve Bank of India has asked it to temporarily stop all launches of its upcoming banking initiatives and issuing of new credit cards.

Erasing all its early gains, the stock dipped 2.13 per cent to close at Rs 1,377.05 on the BSE. During the day, it declined 2.32 per cent to Rs 1,374.25.

On the National Stock Exchange (NSE), it was down 1.84 per cent to close at Rs 1,381.

The company’s market valuation was wiped out by Rs 16,055.99 crore to Rs 7,58,287.01 crore on the BSE.

In traded volume terms, 7.36 lakh shares were traded on the BSE and over 1.89 crore shares on the NSE during the day.

IANS/PTI