RBI asks BoB to suspend new customer onboarding on app

RBI has asked Bank of Baroda (BoB) to suspend further onboarding of customers onto the ‘bob World’, the lender’s mobile banking application.

“The RBI has, in exercise of its power, under section 35A of the Banking Regulation Act, 1949, directed Bank of Baroda to suspend, with immediate effect, any further onboarding of their customers onto the ‘bob World’ mobile application,” RBI said in a release

It said the action on the bank is based on certain material supervisory concerns observed in the manner of onboarding of their customers onto this mobile application.

Under section 35A, the RBI has power to give directions to banks ‘to prevent the affairs of any banking company being conducted in a manner detrimental to the interests of the depositors or in a manner prejudicial to the interests of the banking company’.

The RBI directed BoB that any further onboarding of customers of the bank on the ‘bob World’ application will be subject to rectification of the deficiencies observed and strengthening of the related processes by the bank to the satisfaction of RBI.

The bank has also been directed to ensure that already onboarded ‘BoB World’ customers do not face any disruption on account of this suspension.

In a statement, BoB said that it has already carried out corrective measures to address the concerns of the RBI. It has initiated further steps to plug any remaining gaps identified. The lender also assured its customers that they will not face any disruption and will continue to enjoy uninterrupted services on BoB World mobile app.