RBI partially lifts ban on HDFC Bank, allows it to sell new credit cards
Mumbai, Aug 17: Eight months after barring the country's largest private sector lender HDFC Bank from selling new credit cards, the Reserve Bank of India (RBI) has lifted the ban, banking sources said on Tuesday.
However, the ban on launching new technology initiatives remains, the sources said.
In December last year, the RBI had come out with an unprecedented action implementing both the bans, after repeated instances of technological outages at the lender, which is the market leader in the credit cards segment. Rivals ICICI Bank and SBI Cards seized the opportunity to narrow the gap with HDFC Bank.
"A communication has been received by HDFC Bank regarding the lifting of the ban on credit cards on Tuesday," one of the sources, who declined to be identified, said.
The bank's existing users were not impacted by the ban and it had 1.48 crore credit card customers as of June.
On July 17, the bank's Chief Executive and Managing Director Sashidhar Jagdishan had said it has complied with 85 per cent of the RBI's requirements on the improvements desired, and the ball is now in the regulator's court to re-allow the bank.
Earlier, its technology and credit card vertical had said the time off the market has been utilised to re-draw processes and the teams are raring to go.
Jagdishan had said a technology audit is also over and the RBI will now be "independently" taking a view on when to lift the penal actions taken against the bank.
"We have given a milestone to the regulator in terms of what are the things we are doing on technology, complying with their advisories and directives.
"We have covered a significant portion as we speak. Almost 85 per cent of what we had to do has been covered," Jagdsihan, who has been with the lender for over two decades and worked as the 'change agent' in the years leading to his elevation, said.
He added that the ball is in the regulator's court. "As they deem fit, as they see that we are on the right track, I am sure at some point of time, they will lift the embargo."
Acknowledging that the bank has lost market share in the credit card segment due to the ban, Jagdsihan said tech outages are a global phenomenon but it is the time taken to recover from a setback where the bank erred, leading to the "rap on the knuckles" from the regulator.
The action against HDFC Bank has been followed with a ban on card companies Mastercard and American Express from selling any new cards because of a failure to adhere to data localisation rules.
HDFC Bank's shares on Tuesday fell 0.95 per cent to close at Rs 1,514.85 apiece on the BSE.
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Cong will win by-polls in Karnataka, form govt with allies in Maharashtra: DK Shivakumar
Bengaluru, Nov 22: Karnataka Deputy Chief Minister D K Shivakumar on Friday expressed confidence about Congress winning all the three assembly constituencies in the state where by-polls are held. He also voiced confidence about congress along with its alliance partners coming to power in Maharashtra, without engaging in 'resort politics'.
Results for by-polls to the state's Sandur, Shiggaon and Channapatna Assembly constituencies that were held on November 13, and Maharashtra Assembly polls on November 20, will be declared on Saturday.
"The exit polls will fail, we will win all the three seats. In Channapatna, I said I'm the candidate irrespective of whoever contests from the party, I'm the candidate and I'm the face. If we lose, it is my loss..." Shivakumar, who is also the state Congress chief, said in response to a question.
Speaking to reporters here, he said, he has campaigned in more than 8-10 consistencies in Maharashtra for Assembly polls there, and is confident of the party winning the polls.
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"....without any 'resort politics', we will be able to form the government there (Maharashtra), this is my hope and confidence," he said in response to a question on 'resort politics'.
Asked, in case of hung assembly in Maharashtra and Jharkhand, is there a possibility of Congress MLAs being shifted to Karnataka under his supervision, Shivakumar said, "some national media are reporting this, as far as I'm concerned no leader of AICC has approached or spoken to me. I'm not involved in this. If they call me it is a different issue, but we don't have any such plans."
Shivakumar urged the centre to immediately take action and arrest billionaire Gautam Adani, following the US filing civil and criminal charges against him and seven others over a multi-million-dollar bribery scheme.
"I would like to request the Prime Minister, the image of the government is important, the image of the country is important, and his (Modi) image is also important....we appeal to the PM to book a criminal case against him (Adani) and arrest him...shareholders interest should also be protected," he added.
Responding to a question on whether the state government will initiate any action against Adani group in the state where it has businesses, the Deputy CM said, "The central government should start criminal proceedings, after that if they write to us we will do whatever has to be....there should be a plan of action from the central government, since it is international crime."
Asked if the state government will not have any contract with the company ahead, Shivakumar said, "I won't say that. I can't tell that. If there are clean projects without any corruption.....I won't discuss it now, let's see..."
Replying to a question whether any disciplinary action will be taken against Minister B Z Zameer Ahmed Khan for referring to Union Minister and JD(S) leader H D Kumaraswamy as "Kaalia" (dark-skinned), which the NDA had slammed as a "racist" slur, the DCM said, the matter will be discussed internally in the party.
"I have spoken to him (Khan) personally, he is an important worker and leader. Emotionally he has spoken, I have told him it is not right. CM has also spoken to him. Internally we will discuss, I don't want to discuss in the media. We also make mistakes. We have to set right the people, we will see," he said.
Several Congress party office-bearers have been pushing the party to crack the whip against Khan, a lawmaker from Chamarajpet, accusing him of causing damage and embarrassment to the party. They also feel that his remarks had an adverse impact on the party's prospects in the Channapatna Assembly segment.
