HDFC Bank camouflage payment probe: CEO, CFO & CMO were allegedly aware

The payments were reportedly routed through four local vendors as part of road safety campaigns, but were internally treated as “differential interest” linked to MSRDC deposits with the bank

by e4m Staff
Published: May 27, 2026 8:31 PM | 2 min read

HDFC Bank is under scrutiny for allegedly routing Rs 45 crore through its marketing department, with senior executives, including the CEO, CFO, and CMO, reportedly aware of the transactions linked to deposits from the Maharashtra State Road Development Corporation (MSRDC).
The payments were purportedly structured as contributions to road safety campaigns but were internally categorized as "differential interest" to incentivize large deposits.
The bank's Audit Committee initiated a formal Internal Vigilance Investigation after an internal audit flagged these transactions as unsatisfactory, raising concerns about governance and compliance risks in marketing-related financial arrangements.
Potential violations of banking regulations are being examined, as banks are prohibited from offering special interest rates or incentives for deposits beyond allowed norms; MSRDC confirmed receipt of the promised interest differential but stated the bank's actions are its responsibility.

The controversy around the alleged Rs 45-crore payments routed through the marketing department at HDFC Bank has put the spotlight on the role of senior executives, including the CMO.

An investigation by The Indian Express has revealed that the bank’s top management, including the CEO, CFO and CMO, were allegedly aware of Rs 45 crore being routed through the marketing department as part of payments linked to deposits from the Maharashtra State Road Development Corporation (MSRDC).

The payments, according to the report, were allegedly structured as contributions towards road safety awareness campaigns through four local vendors. Internally, however, they were reportedly treated as “differential interest” promised to MSRDC in return for maintaining large deposits with the bank.

The development has raised broader questions around governance, oversight and the role of marketing departments in handling commercial arrangements that go beyond traditional advertising and brand-building functions.

According to the report, the bank’s Audit Committee of the Board (ACB), chaired by M D Ranganath, ordered a formal Internal Vigilance Investigation on March 12 after an internal audit of the marketing department flagged the transactions and rated the department’s performance as “unsatisfactory”.

The case has also highlighted how marketing spends and sponsorship-led initiatives are increasingly being examined for compliance and governance risks, particularly when linked to customer acquisition or deposit mobilisation strategies.

A senior official cited in the report said that for a bank with deposits of over Rs 31 lakh crore as of March 31, 2026, “the lure of a few thousand crores” should not justify “questionable steps like routing money through a bunch of vendors as sponsorship payments.”

Another source familiar with the internal inquiry reportedly said the arrangement may violate banking regulations because banks cannot negotiate special interest rates for individual customers or incentivise deposits beyond permitted norms. The source also pointed to possible invoicing and tax credit concerns arising from the use of vendors in the transaction chain.

MSRDC, meanwhile, told the publication that it received the promised interest differential, adding that “what the bank has done at their end is their matter.”