Last Updated:
Kotak Mahindra Bank initiated remedial measures to address the supervisory concerns and submitted compliances to the Reserve Bank, says the RBI.
The restrictions on Kotak Mahindra Bank were initially imposed on April 24, 2024.
The Reserve Bank of India (RBI) on Wednesday lifted restrictions on Kotak Mahindra Bank, allowing the lender to resume onboarding new customers via online channels and issuing fresh credit cards. These restrictions were initially imposed on April 24, 2024.
The Mumbai-based bank had been instructed to halt customer onboarding through its online and mobile banking platforms, as well as to stop issuing new credit cards.
“Subsequently, the bank initiated remedial measures to address the supervisory concerns and submitted compliances to the Reserve Bank. The bank also commissioned an external audit, with prior approval of RBI, to validate the compliances. Now, having satisfied itself based on the submissions, and remedial measures undertaken by the bank, the Reserve Bank, has decided to lift the restrictions placed on Kotak Mahindra Bank Limited,” RBI stated.
The central bank’s action stemmed from IT examinations conducted in 2022 and 2023, revealing the lender’s continued failure to comprehensively and promptly address key concerns.
“Serious deficiencies and non-compliances were observed in the areas of IT inventory management, patch and change management, user access management, vendor risk management, data security and data leak prevention strategy, business continuity and disaster recovery rigour and drill, etc. For two consecutive years, the bank was assessed to be deficient in its IT Risk and Information Security Governance, contrary to requirements under Regulatory guidelines,” RBI had noted in April 2024.
