The Reserve Bank of India has directed Bank of Baroda, India’s second largest state-owned lender after State Bank of India, to suspend any further onboarding of their customers onto the ‘bob World’ mobile application with immediate effect.
The central bank, in exercise of its power under section 35A of the Banking Regulation Act, 1949, has stated that the action against the lender is based on certain material supervisory concerns observed in the manner of onboarding of new customers onto this mobile application.
“Any further onboarding of customers of the bank 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 RBI,” the central bank said.
The RBI has further directed the bank to ensure that already onboarded and existing ‘bob World’ customers do not face any disruption on account of this suspension.
In July this year, it was reported that Bank of Baroda officials linked bank accounts to unrelated mobile numbers in order to achieve stiff onboarding targets.
The news report noted that in March 2022 the Bank of Baroda officials from the Bhopal zone were given a target of onboarding at least 150 existing bank customers for the bank’s new app, “bob World”, which was launched six months before.
Al Jazeera claimed that the Bank of Baroda employees from Madhya Pradesh, Uttar Pradesh, Rajasthan, Gujarat and Jharkhand also adopted the widely prevalent modus operandi to achieve the target as they were struggling to get people to sign up for the app. The officers reportedly said their regional office kept tabs on them and reprimanded them for poor performance.
The bank denied the reports and said that unauthenticated or non-customer mobile numbers for boosting app registrations are factually incorrect.
