The second-largest government-owned lender, Bank of Baroda (BoB), has allegedly been involved in unauthorised linking of mobile numbers to bank accounts of customers to show higher registrations on its mobile banking application.
It was two years ago in November that the bank announced a new app with the jargon, “Save, Invest, Borrow, and Shop.”
They promised customers wholesome benefits like UPI payment facilities, recharging bills, booking flights, and even requesting a credit report, all of which would translate into points with monetary value.
Customers could encash the points during online shopping.
Customers needed to push the app too, an alleged ploy by the bank to see a certain number of customers on the app daily.
Finshots.in elaborates, “…the targets were too unrealistic. The staff couldn’t meet them. They began to get an earful from the top management. And no one likes to be pulled up by the bosses, right?
“So some ingenious folks found a workaround. They simply downloaded a list of bank accounts that weren’t linked to any mobile number. And they simply began to input random numbers — it could be the staff’s number, or that of their relatives, or even the cleaning and security staff who worked at the branch. Once the account was linked, they could simply download the app on a phone, get the OTP sent to themselves and sign the customer up on bob World.”
When the truth was out, the Reserve Bank of India (RBI) initiated swift action by asking the banking to discontinue any on-boarding of their customers onto the ‘bob World’ mobile application.
According to CNBC-TV18.com, the RBI said the decision was “based on certain material supervisory concerns observed in the manner of on-boarding of their customers onto this mobile application.”
Earlier, Aljazeera.com reported, “The audits come after an expose by The Reporters’ Collective (TRC) and Al Jazeera, which showed the bank’s employees had linked unauthorised mobile numbers to customer accounts that were missing a registered mobile number to onboard them on the bank’s new mobile banking app, bob World. These unauthorised mobile numbers were of bank staff, managers, guards, their relatives and bank agents in remote areas.”
It added that internal documents of the bank’s head office admit this malpractice. The documents reveal that the bank’s agents withdrew tens of thousands of rupees from customers’ accounts by using mobile banking.
Six customers were duped of Rs 1,10,000, one lost Rs 1,77,000 and one agent swindled away more than Rs 3,90,000.
A spokesperson for Bank of Baroda, however, told CNBC-TV18, “The Bank reiterates that a fully system authenticated, and customer consent-based process has been and is currently being followed for undertaking any mobile banking app registrations in the Bank. The Bank has a current mobile banking activated user base of 3 crore customers, all of whom are linked to a unique mobile number seeded with their bank account.”
CNBC-TV18 claimed that the bank acknowledged the deficit to the Reserve Bank of India when questioned about the tampering with bank accounts.
Following the revelations, Bank of Baroda shares had dropped nearly 4% in early deals last week.