Breaking News
Get 50% Off 0
NVDA gained a massive 197% since our AI first added it in November - is it time to sell? 🤔 Read more

RBI halts new customer onboarding on Bank of Baroda's mobile app

Published Oct 12, 2023 23:12
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.
 
BOB
+0.11%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

The Reserve Bank of India (RBI) has ordered the Bank of Baroda (BoB) to suspend new customer additions to its mobile application "bob World" on Thursday, due to concerns over customer addition processes. This decision marks the first time RBI has blocked a bank from onboarding new customers via mobile banking. The central bank has demanded rectification and strengthening of processes before further customer onboarding can continue.

BoB's shares fell on Wednesday following this directive. At the start of trade, BoB's share price was down 2.05% at ₹209.90. Analysts predict the ban may last several quarters and potentially affect growth in retail product segments given BoB's emphasis on digital sourcing and cross-selling via BOB World.

A report from Al Jazeera revealed that in March 2022 an official from the Bhopal zone linked unrelated mobile numbers to bank accounts to meet strict app registration targets. This unethical process involved generating a one-time password, backend signup, and subsequent removal of customers post-registration, with repeated misuse of the same mobile number.

The 'BoB World' app, launched in September 2021, onboarded three crore customers by fiscal 2023 end and handled significant daily transactions. The app is crucial to the bank's operations, contributing 43% of time deposits and handling 87% of funds transfers. As of March 2023, the bank achieved 53 million app downloads and 30 million active users.

A significant portion of the bank's operations have shifted online with 98% and 91% of savings and current account acquisitions respectively, along with 58% of fixed deposits, 42% of recurring deposits, and 61% of credit cards being sourced digitally. Furthermore, the bank sources 89% of personal loans and 67-68% of home/auto loans digitally, indicating an increase in the Retail, Agriculture and MSME (RAM) segments in total loans.

BoB has initiated corrective actions and pledged uninterrupted services for existing users while addressing RBI's concerns. It can resume new sign-ups only after satisfying RBI's requirements. Existing users will remain unaffected, while new customers can use other digital channels like net banking and WhatsApp banking. The restriction could potentially impede new account openings since the app also offers non-customers a video KYC feature for account opening and employs a two-factor authentication process. This directive doesn't impact other BoB digital channels.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

RBI halts new customer onboarding on Bank of Baroda's mobile app
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email