The Reserve Bank of India (RBI) has removed business restrictions imposed on Kotak Mahindra Bank Ltd. (KMB) following satisfactory compliance with regulatory requirements. The bank can now resume issuing credit cards and on-boarding customers through digital channels.
The restrictions, implemented in April 2024, prevented KMB from acquiring new customers via online and mobile banking platforms and issuing fresh credit cards. The bank undertook remedial measures and submitted compliance reports, which were validated through an external audit.
KMB welcomed the decision and said it would work with the RBI to restart digital customer onboarding and credit card issuance shortly. The bank’s shares responded positively to the news, trading at ₹1,977.80 on the NSE, up 1.74 per cent, and reaching a 52-week high of ₹1,992.80.
This development comes amid a potential shift in regulatory approach under new RBI Governor Sanjay Malhotra, who recently indicated a preference for less frequent use of such restrictions and emphasised the need to evaluate financial implications of regulatory actions. His predecessor, Shaktikanta Das, had imposed similar restrictions on several banks, including a 15-month constraint on HDFC Bank that ended in March 2022.
Source: thehindubusinessline