Public sector lender Bank of Baroda (BoB) has suspended several employees after the Reserve Bank of India (RBI) banned it from onboarding new customers on its ‘BoB World’ moblile app until further notice. The action, which has come after an internal investigation, covers officers, business correspondents and a consultant hired to onboard new customers on the mobile app. The number of employees could not be confirmed as some business correspondents are also affected by this move.
“The bank has suspended some officials including some senior ones at the level of Assistant General Manager for onboarding customers on BoB World application without permission of account holders,” a source in the Bank of Baroda told FE. “The action has been taken against employees from Gujarat and North West region,” she added.
The banking regulator, on October 10, had barred Bank of Baroda (BoB) from onboarding new customers on its flagship ‘BoB World’ mobile application which has 53 million downloads and a 30 million active user base as of March end. The investigation by the bank found that some employees fraudulently linked the mobile numbers with accounts of customers without their consent to increase the active user base of the app and to meet their monthly targets.
“As per the rules, the bank will now issue show-cause notice and prepare chargesheets. Bankers will be provided the opportunity to defend themselves. We cannot say what will be the final punishment as it depends on case-to-case basis. It may result in some punishments like stopping increments, among others,” another source told FE.
Currently, the bank has taken this action against employees in the north and northwest regions. Gradually action will be taken against employees in other regions as well. Apart from the suspension, bank has also transferred some employees to other regions as a punishment posting.
“Senior officials who have been suspended are from Scale-II to Scale-V officers. We may see more suspensions because this action pertains only to just one zone. Actions against employees, involved in this case, will also be taken in coming days,” another source in the Bank of Baroda told FE.
In BoB, Scale-II officer refers to Manager, Scale -III to Senior Manager, Scale-IV to Chief Manager while Scale V refers to Assistant General Manager.
RBI has taken action against other financial instituions. The banking regulator had barred HDFC in 2020 from sourcing new credit cards. The ban on issuance of credit cards was lifted earlier, in August 2021. In March 2022, the RBI barred Paytm Payments from onboarding new customers citing ‘certain material supervisory concerns observed in the bank’. MasterCard was barred from on-boarding new domestic customers for debit, credit or prepaid cards, starting July 22, 2021.
