HDFC Bank CEO Sashidhar Jagdishan has opened up about several instances of digital banking outages faced by customers and how it has embarked on a ‘technology transformation agenda’ to fix them.
In a letter addressed to over 1.20 lakh employees, Jagdishan explained reasons for each of the five instances of downtime the bank’s digital customers faced over the last 28 months. “Yes, we have faced technical issues and we humbly accept that. We are working towards improving ourselves,” Jagdishan’s letter read, a copy of which has been viewed by CNBC-TV18.
He added that the bank has embarked on a scale changing technology adoption and transformation agenda, where the aim is to ““keep systems always on. Always secure. And perform at scale”.
Reason for outages
Jagdishan detailed the reasons for the outages as follows:
November 2018: Crash of the New Mobile Banking App
Reason: The bank faced an unprecedented demand to download the new mobile app. “We have learnt and since refined our processes of managing the mobile banking app and has never faced any such challenges later. After the Nov 2018 initial launch, we have upgraded our mobile app seven times over the last two years and in all these instances it has been a smooth affair with no downtime or customer inconvenience whatsoever.”
December 2019: Outage with Mobile Banking App
Reason: One of the bank’s vendors system upgrade patch issue was faulty, causing the outage, which has since been addressed adequately, the CEO said.
November 2020: Outage at Data Centre
Reason: A third party human error led to the downtime.
March 1, 2021: Net Banking/Mobile Banking downtime
Reason: The issue here occurred on account a faulty signature on the bank’s Host Intrusion Prevention Software (HIPS). “This was an issue acknowledged by the manufacturer which impacted several global clients as well. The faulty signature resulted in slowing down response on Net banking and mobile banking. This has, since, been rectified,” he said.
March 31, 2021: Net Banking/Mobile Banking downtime
Reason: The issue occurred on account of a hardware component failure in one of the bank’s database servers resulting in a slow response to some of customers.
Measures taken by HDFC Bank
Jagdishan outlined the several steps taken by the bank to address these issues since. He said that the bank has invested heavily on infra scalability to handle any additional load over the next three to five years, strengthening its firewalls further for security enhancements and put in place enhanced monitoring mechanisms.
“It is in this context, one has to see the advisories and strictures by the regulators calling for accelerated adoption and process changes. We are working with them closely to overcome the current situation,” he said.
Reserve Bank of India (RBI) in December 2020, temporarily barred HDFC Bank from launching any new digital banking initiatives or onboarding new credit card customers until the regulator was satisfied that the technical issues were taken care of.
HDFC Bank will also follow its normal compensation cycle this year, Jagdishan told employees, even as he alluded to challenges ahead. “In the current financial year, there will be some pandemic related challenges for sure. The beauty of this organisation is the ability to rally around, tap the opportunities and grow. The story of the Bank will not be any different in this financial year and in the coming times,” the letter read.
He added that opportunities continue to present themselves across the retail, MSME and Corporate Banking sectors, and across geographies’ like semi-urban and rural markets where the bank will continue to invest.
“We are not perfect. But our challenges are not insurmountable,” Jagdishan wrote, ending with the oft-repeated line from his predecessor, “the best is yet to come”.