The Reserve Bank of India, the regulator of the banking sector, has taken significant action against HDFC Bank.
The RBI has imposed a penalty on the bank for failing to comply with its orders and guidelines.
The penalty was imposed for not adhering to RBI guidelines on deposit interest rates, the use of recovery agents, and customer service practices within the bank.
On September 10, 2024, the Reserve Bank of India announced that it has fined HDFC Bank Rs 1 crore, following an order issued on September 3, 2024.
The penalty is due to the bank’s failure to comply with RBI instructions regarding deposit interest rates, the use of recovery agents, and customer service.
The RBI stated that this action is being taken under its authority granted by the Banking Regulation Act.
The RBI conducted a supervisory evaluation to determine the bank’s financial position as of March 31, 2022.
The investigation found violations of RBI instructions, leading to a notice being issued to the bank, questioning why a penalty should not be imposed.
After reviewing the bank’s response and holding a personal hearing, the RBI confirmed that the allegations against the bank were valid.
HDFC Bank provided depositors with a Rs 250 gift as a premium for the first year of free life insurance cover when they accepted certain deposits.
The bank also opened savings accounts for ineligible entities and did not prevent customers from being contacted between 7 pm and 7 am.
This penalty was imposed on HDFC Bank for failing to comply with RBI’s instructions and guidelines.
