Nowadays, as we know cyber fraud incidents are increasing day by day so in response to that several financial institutions such as the Bank of Baroda, World App scam, and RBI of India stopped Bank of Baroda's customer onboarding on its Bank of Baroda World mobile app in October 2023. The Finance Ministry is currently taking several measures to improve cybersecurity so that it can enhance the security of due diligence procedures in financial institutions like BOB Bank, in order to prevent these types of scams.
The RBI ordered the Bank of Baroda to stop adding new users to the Bank of Baroda World app to comply with Section 35A of the Banking Regulation Act, 1949 because of serious supervisory concerns. Before resuming customer onboarding, the bank is required by rule to improve pertinent processes and address any flaws to the satisfaction of the RBI.
According to this plan, banks and other financial institutions are required by the Finance Ministry to carry out more thorough Know Your Customer processes and due diligence, especially when onboarding new merchants and business correspondents. To reduce the risk of security breaches, the need for enhanced data security policies at the merchant and business continuity levels is stressed.
The idea additionally stresses how important it is to consider the concentration of Business Correspondents in locations with a high incidence of cybercrime. By reducing the hazards connected to the concentration of BCs in high-risk areas, this initiative seeks to improve cybersecurity resilience generally.
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