Kotak Mahindra Bank: RBI has also decided to ban Kotak Mahindra Bank from adding new customers through online or mobile banking channels.
RBI On Kotak Mahindra Bank: Banking sector regulator Reserve Bank of India has taken major action against Kotak Mahindra Bank. RBI has banned Kotak Mahindra Bank from adding new customers through online or mobile banking channels. Apart from this, RBI has also decided to ban the issuance of new credit cards of Kotak Bank. However, RBI said that Kotak Mahindra Bank will continue to provide all services to its existing customers including credit card customers.
RBI issued a press release saying that during the IT examination of the Reserve Bank of India for 2022 and 2023, concerns were expressed regarding various shortcomings in the bank. Kotak Mahindra Bank has failed to resolve these concerns within the stipulated time. RBI said that due to lack of robust IT infrastructure and IT risk management framework, the bank’s core banking system and its online and digital banking channels have faced several outages in the last two years. In the same month, on April 15, 2024, the services were halted due to which the bank customers had to face problems.
According to RBI, Kotak Mahindra Bank has failed to strengthen its IT systems with its growth. In the last two years, RBI has been in constant touch with the top management of the bank to strengthen the IT systems and overcome these problems. But the result has not been satisfactory.
According to RBI, there has been a strong increase in the volume of digital transactions of the bank, which also includes transactions related to credit cards. This has increased the load on IT systems. For this reason, keeping in mind the interests of the customers, RBI has decided to impose business restrictions on the bank so that long-term outage can be prevented because this will not only affect the customer services of the bank but also the financial performance of digital banking and payment systems. The ecosystem will also be shocked.
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