The Reserve Bank of India (RBI) has directed Bank of Baroda to suspend the onboarding of any new customers on their ‘bob World’ application. Exercising its power under Section 35A of the Banking Regulation Act, 1949, the apex bank has said, “This action is based on certain material supervisory concerns observed in the manner of onboarding of their customers onto this mobile application.”
It added, “Any further onboarding of customers of the bank on the ‘bob World’ application will be subject to rectification of the deficiencies observed and strengthening of the related processes by the bank to the satisfaction of RBI.
Bank of Baroda issues clarification
Following the action by RBI, Bank of Baroda said that it has carried out corrective measures to address the apex bank’s concerns and it will initiate further steps to plug any remaining gaps identified. Bank of Baroda in a stock exchange filing said, “We will work closely with the RBI to address their concerns at the earliest to their satisfaction.”
It has assured its existing customers that this action by the RBI will not lead to any disruptions in services on their app. Reassuring its customers of its app’s robust security, the state-owned lender said, “The Bank has always endeavoured to provide seamless digital banking services to its customers and over the last few years, the Bank has made significant investments in technology, which provides customers with a seamless and secure banking experience, with robust controls and security features.”
According to a report, this action by RBI against Bank of Baroda is a result of a media report from July 2023 that stated that bob World was involved in tampering of customer accounts to boost registrations. In a press release issued after this media report, Bank of Baroda said, “The bank reiterates that a full system authenticated, and customer consent-based process … is currently being followed for undertaking any mobile banking app registrations in the bank. The bank has a current mobile banking activated user base of three crore customers, all of whom are linked to a unique mobile number seeded with their bank account.”