The RBI has lifted all restrictions on HDFC Bank, permitting it to launch new digital initiatives, the private sector lender said on Saturday.
“We would like to inform one and all that the Reserve Bank of India (RBI) has lifted the restriction on the business generating activities planned under the Bank’s Digital 2.0 programme, vide its letter dated March 11, 2022,” HDFC Bank said in a statement.
Digital 2.0 programme of the bank is designed to provide products to its customers for frictionless financial experience. It will help customers to move from a single transaction to a complete financial solution journey such as loan disbursement, payments and investment.
In December 2020, the RBI had barred HDFC Bank from issuing new cards and launching new digital initiatives after repeated instances of technological outages at the lender, which is the market leader in the credit cards segment.
The RBI action came after the bank’s customers faced a number of incidents of outages in internet banking, mobile banking, and payment utilities over the past two years. Rivals ICICI Bank and SBI Cards seized the opportunity to narrow the gap with HDFC Bank.
The action against HDFC Bank was followed by a ban on new card issuances by Mastercard and American Express due to their failure to adhere to data localisation rules.
Following remedial action from HDFC Bank, the regulator partially lifted the ban on card issuances last year in August. However, the ban on launching new technology initiatives continued.
With lifting of both the bans, the bank in the statement said it is fully committed to ensuring continued adherence to the highest standards of compliance with RBI recommendations.
“We have utilised this time to draw up short, medium, and long-term plans to meet the evolving digital requirements of our customers and we will roll out these initiatives in the days to come,” it added.