Why did RBI take strict action against Kotak Mahindra Bank? What will be the impact on existing account holders and customers? – ..
RBI action against Kotak Mahindra Bank: The Reserve Bank has taken strict action against Kotak Mahindra Bank, one of the leading private sector banks. RBI has directed Kotak Mahindra Bank to stop issuing new credit cards with immediate effect. Now the bank will not be able to issue credit cards to any new customer. Along with this, from now on it will not be able to add any new customer through online and mobile banking channel.
Why was this ban imposed?
The Reserve Bank of India has taken this action under Section 35A of the Banking Regulation Act 1949. RBI has said that between the year 2022 and 2023, the bank is facing problems due to lack of updates in its IT infrastructure. RBI had already warned about this but Benek was not paying attention to his shortcomings. After this, now RBI has taken this action.
The regulator said that in future the bank’s server should not go down and customers will not have to face serious problems. Keeping this in mind, RBI has taken this action. The Reserve Bank said that flaws related to the IT sector not only cause problems for customers but also harm the digital banking and financial ecosystem.
What will be the impact on old customers?
At present, a large number of customers in the country are taking the services of Kotak Mahindra Bank, but now the question is, what effect will this action of RBI have on the old customers? However, those who are already customers of the bank will continue to get all the services as before. The central bank has said that the bank will continue to provide the same facilities to its existing credit card users as before.
Country’s fourth largest bank
Kotak Mahindra Bank is the fourth largest government bank in the country in terms of market cap. The market cap of Kotak Mahindra Bank is Rs 3.66 lakh crore. At the same time, the name of HDFC Bank is currently at number one. The market cap of HDFC is Rs 11.48 lakh crore. ICICI Bank is in second place and its market cap is Rs 7.69 lakh crore. At the third place is the name of public sector bank SBI. Its market cap is Rs 6.89 lakh crore.
The bank has 4.12 crore customers
Currently, Kotak Mahindra Bank has 4.12 crore customers and more than 49 lakh of them have active credit cards. At the same time, more than 28 lakh customers have active debit cards.
Its effect will be visible on shares today
The impact of RBI’s decision on Kotak Mahindra Bank shares will be visible in the market today. The company’s shares closed 1.65% higher at Rs 1,842.95 on Wednesday. In the last 6 months, the bank’s shares have given only 6.65 percent return to the investors. At the same time, investors have got a return of 5.09% in the last one month.
