Banking Central | It's trust that's under threat. Banks should read fine prints in RBI missive to BoB

On October 10, the Reserve Bank of India (RBI) asked Bank of Baroda (BoB) to suspend adding customers to its ‘bob World’ mobile application because of some material supervisory concerns.

Any further onboarding of customers 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 the RBI, the central bank said. The state-run lender has been further directed to ensure that the onboarded ‘bob World’ customers do not face any disruption on account of this suspension.

According to a CNBC report, BoB is understood to have acknowledged unauthorised linking of mobile numbers to bank accounts of customer in order to show higher registrations on its mobile banking application, leading to the regulatory action. It later released a clarification, stating that it has carried out corrective measures to address the concerns highlighted by the RBI and is taking further steps to plug any remaining gaps.

Though this incident is specific to one bank, such practices are long prevalent in the larger banking system. Banks tend to conveniently forget the fair rules of the game eyeing super fast growth numbers. In this process, ethics and customer fairness are conveniently forgotten. Needless to say, this is a worrying trend for both the customers and the regulator. Adding customers without their consent is an unprofessional action on the part of a bank to say the least. Such practices should be dealt with strong penal actions.