The RBI has directed Kotak Bank to stop accepting new customers through its mobile and online banking platforms. Due to some serious issues discovered during the bank's IT review. RBI disallows the private lender from providing new credit cards.
59.54 lakh credit cards have been provided by Kotak Mahindra Bank.
Serious problems and non-compliances in a number of areas were found during the RBI's IT inspection, including:
1. Inventory management for IT
2. Change and patch management
3. Management of user access
4. Risk management for vendors
5. Data protection and leak strategies for avoidance
6. Disaster recovery and business continuity: rigor and practice
It was found that the bank had submitted not enough, incorrect, or non-sustained compliance with the 2022 and 2023 Correct Action Plans that the RBI had issued, which amounted to severe failure to comply.
The RBI stated that Kotak Mahindra Bank's Core Banking System (CBS), online, and digital banking channels suffered frequent and major failures in the last two years, seriously upsetting customers, as a result of the lack of a strong IT infrastructure and risk management framework. The date of the most recent outage was April 15, 2024.
1. Existing clients of Kotak Mahindra Bank, including those who hold credit cards, will still get services from the bank.
2. The bank made it clear that, with the exception of issuing new credit cards, its branches would keep onboarding new clients and offering them other services.
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