In a major respite to Bank of Baroda (BoB), the Reserve Bank of India (RBI) has removed the restrictions on its mobile application, BoB World, with immediate effect. With this, the PSU bank will be allowed to onboard new customers through its mobile app once again. Cheering the news, the shares of BoB surged as much as 3.4% to ₹268.85 apiece on BSE today.
The RBI conveyed this decision through a letter, permitting the bank to operate BoB World. “We wish to inform that the RBI, via its letter dated May 8, 2024, conveyed to the bank its decision to lift the aforementioned restrictions on BoB World with immediate effect. As such, the bank is free to onboard customers through the BoB World application in accordance with the applicable guidelines and extant laws/regulations,” the BoB exchange filing states in a filing released today.
Following the lifting of restrictions, BoB will resume onboarding new customers through the BoB World app. The bank says it is commited to maintain regulatory compliance and adherence to guidelines. In October last year, the RBI had instructed the bank to stop onboarding customers via the app due to supervisory concerns.
In early October 2023, the Reserve Bank of India (RBI) instructed Bank of Baroda to immediately halt the process of onboarding new customers onto its 'BoB World' mobile application. The banking regulator stated that this decision was made due to specific supervisory concerns regarding the process of onboarding customers onto the 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 stated.
This restriction had a big impact on the bank's digital platform-driven retail business, as a significant portion of savings accounts, current accounts, time deposits, and retail advances were sourced through the BoB World app. However, the bank had adapted by increasing focus on other customer acquisition channels such as tab banking and branch banking.
