‘Bachao Desh Bachao Manch Bank’ has asked the Reserve Bank of India (RBI) to introduce a mobile banking app in the backdrop of the banking regulator taking action against the bank. requested the appointment of an independent information systems (IS) auditor to carry out a thorough investigation of the banks. Baroda (BoB) has resolved this issue due to certain critical oversight issues in the way it onboards customers to its mobile applications.
In a letter to RBI Governor Shaktikanta Das, the civil society forum expressed concern over the efforts being undertaken by various banks to onboard customers to mobile banking apps through corporate correspondents and employees. . As a result, customers claim that they have suffered large losses due to fraud by fraudsters.
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Forum co-convenors Sowmya Dutta and Biswaranjan Ray said under such a push, everything from selling third-party products to opening checking accounts to onboarding customers for mobile banking apps He said impossible targets are being set for branch-level staff of banks in banking channel activities. , etc., which often result in irregular and illegal activities. Furthermore, authorities turn a blind eye to such activities as long as their goals are met.
To achieve their goals, branch officials resort to corruption to satisfy authorities, they alleged.
“This breach of the fundamental fiduciary responsibility that banks must always uphold – to protect the interests of public depositors who have the utmost confidence in the security and safety of the banking system – is truly astonishing.” ” the co-converters said in a letter to the governor.
The forum said that in addition to appointing information systems auditors, the RBI should direct all banks not to set unachievable targets for their branch staff. This will ensure that staff do not resort to cheating to satisfy authorities.
The forum has asked the RBI to direct all banks to investigate the operations of their correspondents in case of irregularities such as alteration of customers’ biometric information during account opening and monitoring of customer service kiosks. There is.
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On October 10, RBI directed BoB to suspend further onboarding of customers to the ‘bob World’ mobile application with immediate effect.
The Central Bank stated that this action (taken in exercise of its powers under section 35A of the Banking Regulation Act 1949) was taken in response to certain serious supervisory concerns observed in registering customers with ‘Bob World’. said that it is based on.
The BoE said in a statement: “While the Bank has already taken corrective action to address the RBI’s concerns, we have initiated further steps to fill the remaining gaps identified and we are working closely with the RBI to We will address their concerns.” Fastest to their satisfaction. ”
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Faced with difficulties in increasing the number of registrations for mobile banking apps, desperate central bank branch staff resorted to workarounds and bank accounts not linked to mobile phone numbers, according to a July 2023 Al Jazeera report. They obtained a list of accounts and linked those accounts to every mobile phone number they could gather. Bank employees, sanitary and security personnel, and their relatives will generate one-time passwords (OTPs) required to join the app and sign up for these accounts from the backend.
Employees unregistered these customers from the app and reused the same cell phone numbers for other bank accounts as well, according to the report.
BoB did not respond to emails from business line We are seeking comment on the aforementioned report and the actions it has taken.
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