RBI bars Kotak Bank from adding customers digitally
RBI) barred Kotak Mahindra Bank from signing up new customers through its online and mobile banking channels, and issuing fresh credit cards, among the toughest curbs imposed on a scheduled bank. The regulator said Kotak had failed to fix its IT systems after being asked to do so continuously over the past two years. The regulator cited «serious deficiencies and non-compliances» by Kotak in a statement shortly after the stock market closed on Wednesday. The third-most valued private bank in terms of market capitalisation was asked to stop the functions cited «with immediate effect». The stock closed at ₹1,843.05, up 1.64% on the BSE, at a market cap of ₹3.66 lakh crore.
Kotak said it would resolve the matter quickly and assured customers there wouldn't be any interruption to services.
«The bank has taken measures for adoption of new technologies to strengthen its IT systems and will continue to work with RBI to swiftly resolve balance issues at the earliest. We want to reassure our existing customers of uninterrupted services, including credit card, mobile and net banking,» Kotak said in a statement.
Curbs in the Interest of Customers, says Reserve Bank
The bank said: «Our branches continue to welcome and onboard new customers, providing them with all the bank's services, apart from issuance of new credit cards.»
The curbs will be reviewed after an external audit and ensuring all deficiencies have been remedied, the regulator said.
The RBI has been cracking down on regulated entities over non-compliance. In
