Taking cognizance of the recent issue of mis-selling of GPS products along with car loans, HDFC Bank is working on more controls to ensure such problems do not recur.

“I am personally determined to fix this. At an organisational level there is a greater focus on the role of Credit, Risk, Compliance, Audit and other enabling functions so that our checks and balances get strengthened,” said Sashidhar Jagdishan, Managing Director and CEO, HDFC Bank.

In his message to shareholders in the bank’s Annual Report 2020-21, Jagdishan said the lender has over the last year put in place a systemic way of measuring customer experience by adopting the Net Promoter System. This would enable it to get customer feedback post transactions.

The Reserve Bank of India had on May 28 imposed a monetary penalty of ₹10 crore on the private sector lender.

HDFC Bank has also said it will be refunding the GPS device commission to auto loan customers who availed of the devices as a part of the auto loan funding during fiscal years 2013-14 to fiscal year 2019-20.

Jagdishan said that for many years the bank had been bundling the financing of GPS systems and cars. “The teams believed this was a routine lending activity. Also, a particular vendor had entered into an arrangement with us directly,” he said.

After the whistleblower complaint, the bank conducted an enquiry and basis the findings took necessary actions against the involved employees including termination of their services and also terminated the arrangement with the vendor.

“Reinforcing the three Cs: Culture, Conscience and Customers across the organisation is a clear focus area for both me and the Bank,” Jagdishan stressed.

Highlighting his other focus areas, he said HDFC Bank is working to augment its digital capacities post outages in its mobile and net banking services.

“The regulator also appointed a third party audit of our IT systems. This audit is now over and the report has been submitted to the regulator. We now await the decision from the RBI,” he said.


In terms of the expansion strategy, Jagdishan said the bank has created a new business segment of Commercial (MSME) and Rural Banking to capture the next wave of growth.

“We will continue to strengthen our leadership position in the payments business and retail assets business and have added Wealth Management and Private Banking as a core focus area for us,” he said, adding that it will also focus on the Corporate Cluster and Government Business to increase penetration.