What could be the impact of the digital ban on HDFC bank imposed by the RBI?

In a rather surprising move, the RBI imposed a ban on several digital activities of HDFC Bank considering frequent outages that the bank has been facing in its digital and credit card offerings. All fresh digital launches and fresh credit card sourcing will be under curb for now.

HDFC Bank board has to examine the lapses and fix accountability. It has had 3 major outages in its digital business over last 2 years and the disruption had caused tremendous strain and concerns for its vast customer base. Essential Digital 2.0 will be on halt.

While HDFC Bank has assured customers that there will be no impact on operations, the stock of HDFC Bank fell by 2.2% while its nearest competitor, SBI Cards, in the credit card business gained almost 5% on Thursday. HDFC Bank is the largest credit card issuer in India followed by SBI Cards in second place.