MUMBAI : India’s largest private lender, HDFC Bank Ltd, said Thursday it will refund commissions to auto loan customers who “used” a bundled GPS device between FY14 and FY20.
Mint reported on July 20, 2020 that HDFC Bank’s car loan customers were forced to purchase a vehicle tracking device, possibly in violation of guidelines that prohibit banks from conducting non-financial transactions. Mint reported that HDFC Bank executives were pushing car loan customers to buy GPS devices ₹18,000-19,500 from 2015 to December 2019. The device in question was sold by Trackpoint GPS, a Mumbai-based company.
“The refund will be credited to the customer’s repayment account deposited with the bank,” said the bank in a newspaper advertisement.
This comes after the Reserve Bank of India (RBI) issued a last month ₹10 crore fine to lender after reviewing documents related to allegations of inappropriate lending practices in its vehicle financing operations.
After receiving a whistleblower complaint, the bank carried out an internal investigation into the car loan business and initiated disciplinary action against employees who were found to be involved in “personal misconduct”, the then managing director and chairman of the board of the HDFC Bank, Aditya Puri, had the Notified to shareholders at the annual general meeting in July last year.
The bank also said Thursday that it would do everything it could to get the digital banking infrastructure up and running. The private lender has been plagued by digital disruption for various reasons and said it is investing in newer technology to grow it.
“We are very focused on making these investments. Whatever it takes, we are very focused on making it because it is the right investment in technology, “said Ramesh Lakshminarayanan, chief information officer for the bank.
The bank is seeing a change in the way it approaches technology, Lakshminarayanan said. Nowadays, concepts like elastic scaling, on-demand scaling, container-enabled and cloud-native architecture have become the order of the day, he said.
“While we’ve seen some failures in the past few years, that doesn’t mean we’re not investing in or investigating all of the existing technology. This is an area that we are constantly improving and monitoring, “said Lakshminarayanan.
HDFC Bank customers expect a certain quality and a gold standard, which, according to Lakshminarayanan, the bank probably does not live up to. The changes made will soon be reflected in the customer experience, he said.
There will be changes to customer payments and call center experiences in the 15 to 18 month period from the end of this year and early next year, he said.
In December, RBI ordered HDFC Bank to freeze new digital banking initiatives and credit card spending until it fixed the bugs that had caused multiple disruptions in their internet and mobile banking systems over the past two years.
In February of this year, the regulatory authority commissioned an external company to carry out a special audit of the entire IT infrastructure of the bank.
Lakshminarayanan said the bank has completed all assessments and the matter is with the regulator.
On June 15, the bank’s mobile application failed again, but the lender was soon able to fix it
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