The Reserve Bank of India (RBI) on Thursday put a temporary halt on HDFC launching any new digital activities and issuance of credit cards while telling its board of directors to examine and fix the glitches, Indian daily Hindustan Times reported.
RBI, which is India’s apex bank, in a statement to the stock exchanges noted that it has advised the private lender “to temporarily stop all launches of the digital business-generating activities planned under its programme Digital 2.0” after “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 21 November, 2020, due to a power failure in the primary data centre”.
The news that pushed HDFC shares over one percent on Thursday has stirred a buzz on social media, with some netizens siding with RBI’s action, saying it was long overdue.
Finally HDFC Bank gets a rap from RBI!— Aditya Shah,CFA (@AdityaD_Shah) December 3, 2020
Long overdue. pic.twitter.com/vMZNNamOGx
Wow, this is a huge news item with major ramifications!— Warrior Squawk (@SquawkWarrior) December 3, 2020
Cannot go un-noticed!
Responding to the RBI’s directions, HDFC said that over the previous couple of years it had been taking “conscious, concrete steps to remedy the recent outages on its digital banking channels” while assuring its customers that the RBI’s action will not change its existing digital banking channels, credit cards, and existing operations.
The RBI is expected to revoke its suspension measures on HDFC after “satisfactory compliance with the major critical observations” is pointed out by the apex bank.