RBI cracks down on HDFC Bank's internet outages; stops signing up of new credit card customers

The Reserve Bank of India (RBI) on Thursday, November 3, stopped HDFC Bank from sourcing new credit card customers and halted its upcoming digital activities.  

The regulator issued an order with respect to "certain incidents of outages in internet banking/mobile banking/payment utilities" of the bank over the past two years.

This comprises some outages in internet banking and payment system on November 21 due to a power failure in the primary data centre.

Also Read: RBI seeks explanation on frequent disruptions after HDFC Bank's e-services face 12-hour outage

The development came after the private lender suffered its third major outage in the span of just two years.

"The RBI has advised to stop 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 (sourcing of new credit card customers," the bank said in an exchange filing.

The RBI order has asked HDFC Bank to temporarily stop:  

1. 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,  

2. Sourcing of new credit card customers.  In addition, the order states that the Bank's Board examines the lapses and fixes accountability  

RBI will lift the restrictions once it is satisfied that the issues have been met with compliance and accountability fixed.

Meanwhile, HDFC Bank has said it is taking "concrete steps" to "remedy the recent outages on its digital banking channels."

Also Read: Reliance Capital defaults on HDFC, Axis Bank loans

The restrictions, although temporary, come less than two months after Sashidhar Jagdishan took charge as the bank's CEO.  

Customers had in December last year complained that they were unable to pay their loan EMIs or pay credit bills on time following which the RBI's deputy governor M.K. Jain said the regulator had taken cognisance of the outage and constituted a team of experts to look into the matter.