HDFC Bank Slumps After RBI Orders Halt On Digital Launches, New Credit Cards

On Thursday, shares of HDFC Bank slipped over one percent after the Reserve Bank of India (RBI) asked the private lender to temporarily stop all launches of the Digital Business and sourcing of new credit card customers.

The regulator had sought details behind the data centre outage that meant services on the Unified Payments Interface (UPI), ATMs and card channels were unavailable for several hours.

"Pursuant to the Regulations, we wish to inform you that the Reserve Bank of India (RBI) has issued an Order dated December 02, 2020 ("Order") to HDFC Bank Limited (the "Bank") with regard to certain incidents of outages in the internet banking/ mobile banking/ payment utilities of the Bank over the past 2 years, including the recent outages in the Bank's internet banking and payment system on November 21, 2020 due to a power failure in the primary data centre," the bank said in BSE filing.

"The RBI vide said Order has advised the Bank to temporarily stop i) 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 (ii) sourcing of new credit card customers. In addition, the Order states that the Bank's Board examines the lapses and fixes accountability," it added.

"The Bank over the last two years has taken several measures to fortify its IT systems and will continue to work swiftly to close out the balance and would continue to engage with the Regulator in this regard," HDFC Bank said.