The Reserve Bank of India said on Wednesday that it had lifted its 10-month-old order barring Kotak Mahindra Bank from onboarding new clients digitally and issuing fresh credit cards due to gaps in its IT infrastructure.

Reserve Bank of India has removed restrictions on Kotak Mahindra Bank, enabling the bank to restart its credit card offerings and onboard new customers via digital platforms.

The Reserve Bank on February 12, 2025 decided to lift the aforementioned restrictions placed on Kotak Mahindra Bank Limited. Now customers can apply for new Kotak Mahindra 811 Bank Account through its online and mobile banking channels,

India's central bank on Wednesday lifted restrictions on Kotak Mahindra Bank that had barred the lender from taking on new customers via its online and mobile banking channels and from issuing new credit cards.

RBI had asked place restrictions in April last year after finding deficiencies and non-compliances in Kotak Mahindra Bank’s IT inventory management and data security, among other issues

RBI lifts restrictions on Kotak Mahindra Bank, allowing it to onboard new customers and issue credit cards after IT compliance improvements.

Kotak Mahindra Bank's shares surged 2.5% after the RBI lifted restrictions on new credit cards and online account openings. Brokerages reacted positively, raising target prices and highlighting the bank's potential for growth in the high return on equity credit card business and digital customer acquisition.

Kotak Mahindra Bank share price rose over 2% to touch a 52-week high on Thursday's session following the Reserve Bank of India's (RBI) removal of restrictions on its digital banking activities. Almost 10 months after the restrictions were implemented,

Kotak Mahindra Bank’s share price rose 2.25% to an intra-day high of Rs 1,987.70 after the Reserve Bank of India lifted restrictions on the private lender, enabling it to onboard new customers via online channels.

Kotak reported a 10% surge in its profit levels at Rs 4,701.02 crore in Q3FY25 as compared to Rs 4,264.78 crore recorded in the corresponding quarter of the previous year. The recent removal of restrictions has further boosted brokerages' outlook on the stock.