In a significant development, the Reserve Bank of India (RBI) has imposed restrictions on Kotak Mahindra Bank,
barring the private sector lender from adding new customers and issuing fresh credit cards via its online and mobile banking channels.
This move has left existing customers in a state of uncertainty, prompting questions about the impact on their accounts and services.
Here’s a breakdown of the situation and its implications for Kotak Mahindra Bank customers.
Impact on Existing Customers:
Existing Kotak Mahindra Bank customers who have opened their accounts digitally need not fret over the RBI’s decision.
They can continue to operate their accounts seamlessly through the bank’s internet banking and mobile banking applications, unaffected by the recent regulatory action.
Service Continuity for Existing Accounts:
Amidst the regulatory measures implemented by the RBI,
there will be no disruption to the services provided to existing Kotak Mahindra Bank account holders.
The bank has assured its customers via an official statement that they will continue to enjoy access to services including credit cards,
mobile banking, and net banking without any interruption.
Kotak 811 Digital Savings Account:
However, new customers looking to open a Kotak 811 digital savings account will face hurdles following the RBI’s ban.
The restriction extends to new account openings, impacting the bank’s digital account acquisition efforts.
Credit Card Renewals and Existing Cardholders:
While the current restrictions imposed by the RBI should not affect existing Kotak Mahindra Bank credit card customers, clarity on the renewal process is advisable.
According to Kotak Bank branches, existing cardholders should not encounter obstacles in renewing their cards.
RBI’s Action and Regulatory Compliance:
The RBI’s decision to curtail certain services at Kotak Mahindra Bank stems from the bank’s failure to rectify deficiencies in its digital operations despite repeated directives from the regulator.
This marks a shift in the RBI’s approach towards non-compliance, signaling a tougher stance with stringent measures including service bans on banks and NBFCs,
departing from its previous practice of imposing fines for such infractions.
