SUMMARY
Kotak Mahindra Bank has also been asked to stop issuing fresh credit cards
The RBI cited the private sector lender’s “continued” failure to address the central bank’s concerns following its IT audit as the reason for the move
The RBI said that the bank will continue to provide services to its existing customers, including its credit card customers
The Reserve Bank of India (RBI) has barred Kotak Mahindra Bank from onboarding new customers through its online and mobile banking channels.
In a statement issued on Wednesday (April 24), the central bank said, “The Reserve Bank of India has today, in exercise of its powers under Section 35A of the Banking Regulation Act, 1949, directed Kotak Mahindra Bank Limited to cease and desist, with immediate effect, from (i) onboarding of new customers through its online and mobile banking channels and (ii) issuing fresh credit cards.”
However, the RBI said that the bank will continue to provide services to its existing customers, including its credit card customers.
The central bank said that it took the steps based on concerns following its IT examination of the bank and the latter’s “continued” failure to address these concerns in a comprehensive and timely manner.
“Serious deficiencies and non-compliances were observed in the areas of IT inventory management, patch and change management, user access management, vendor risk management, data security and data leak prevention strategy, business continuity and disaster recovery rigour and drill,” the RBI said.
