Kotak Mahindra Bank Barred from Onboarding New Customers Online
RBI Imposes Restrictions Due to IT Concerns
Mumbai, April 24 (Reuters) -
The Reserve Bank of India (RBI) has barred Kotak Mahindra Bank, one of India's largest private lenders, from taking on new customers through its online and mobile banking platforms. This move follows significant concerns raised by the RBI's IT examination of the bank.
According to the RBI, the restrictions have been imposed due to "material supervisory concerns observed in the bank with regard to its IT infrastructure." The bank has been directed to address these concerns promptly and submit a report to the RBI within three months.
Kotak Mahindra Bank shares fell sharply after the announcement, reflecting investor concerns about the impact of the restrictions on its growth. The bank has stated that it is working closely with the RBI to resolve the issues and restore its normal operations as soon as possible.
Meanwhile, industry experts have expressed concern over the lack of adequate infrastructure and policies in Indian banks to protect customer data. A recent report by McKinsey Company highlighted the need for banks to invest in data security measures to prevent data breaches and protect customer trust.
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