RBI’s Regulatory Action on Bank of Baroda’s Mobile App Stirs Concerns

RBI’s Regulatory Action Sparks Concern

Pune, October 11, 2023: In a recent turn of events, Bank of Baroda (BoB), one of India’s leading banks, has found itself in the regulatory spotlight. The Reserve Bank of India (RBI) has taken significant actions related to BoB’s mobile application, BoB World, prompting apprehension among millions of its customers, both new and existing.

Immediate Suspension of New Customer Additions

The cause of concern stems from the RBI’s swift decision to enforce an immediate stay on the addition of new customers to BoB World, BoB’s mobile app. The RBI has attributed this measure to errors identified in the customer participation process. As a result, new customers seeking access to BoB’s app will temporarily be unable to avail themselves of this service. Moreover, existing customers who have yet to utilize the application will also experience a temporary suspension of its benefits.

Impact on Customers

The ramifications of this temporary suspension are significant, as affected customers will need to seek alternative offline or online channels to access the various banking services offered by Bank of Baroda. This decisive action by the RBI is grounded in its regulatory authority, specifically invoking Section 35A of the Banking Regulation Act, 1949.

RBI’s Authority Under Section 35A

Section 35A of the Banking Regulation Act, 1949, empowers the RBI to take essential measures to safeguard the stability and integrity of the banking sector. In this specific case, the RBI has exercised this authority to restrict Bank of Baroda from adding new customers to the BoB World app until all identified errors have been comprehensively addressed.

Prerequisites for Suspension Removal

It is crucial to note that the suspension on new customer additions to the BoB World app will be lifted exclusively upon Bank of Baroda’s successful resolution of the identified errors, as stipulated by the RBI. During this period, it is incumbent upon the bank to ensure that existing customers currently using the BoB World app encounter no disruptions or difficulties in their banking experience.

In summary, the RBI’s recent regulatory actions against Bank of Baroda’s mobile app, BoB World, have sent shockwaves through the bank’s customer base. The suspension of new customer additions to BoB World serves as a precautionary step to address identified errors in the customer participation process. Bank of Baroda now faces the critical task of rectifying these issues and ensuring a seamless banking experience for its existing customer base.