Mahesh Bank launches RuPay ATM card

Hyderabad, Feb. 5: The increasing use of ATM cards will be cost-effective for banks as well as customers, according to Mr A.P. Hota, Managing Director and Chief Executive Officer of National Payment Corporation of India. Speaking after formally launching ‘Mahesh RuPay ATM card' Mr Hota said Mahesh Bank had taken a lead in the cooperative sector in south India by launching its ATM card. R. Ramesh Kumar Bung, Chairman, Mahesh Bank said his bank's business had crossed Rs 1,775 crore and the branch expansion was being spread to different states. Mr A S Rao, Regional Director, Reserve Bank of India said the number of urban cooperative banks had come down from 115 to 103 in the recent past. ATMs were a versatile instrument and an important delivery channel, he added. The National Payment Corporation of India Ltd has launched the ‘Rupay' ATM card mainly for no frills account holders in collaboration with banks. It is expected to reduce overall transaction costs for banks by introducing competition to international card schemes like Visa and Master.

HBL

Liquidity problem

February 5, 2012: In the banking and corporate world, the word ‘liquidity' is heard quite often. But how does one explain liquidity to a general audience? Former Governor of the Reserve Bank of India, Y.V. Reddy, well-known for his ready wit, had a 300-strong audience in splits when he gave liquidity a new definition at a function held in Hyderabad recently. “For a Central Bank or banks, liquidity means something related to cash reserves, while for a company, liquidity is generally linked to solvency or cash in hand. But in Hyderabad, after 6 p.m., liquidity means beer or whisky,” he quipped. He sure got the point across effectively, though the definition may have been far from accurate.

HBL

Smoking zones work

Responding to our question on ‘unofficial smoking zones' in workplaces (despite a ban), readers acknowledge that while smoking is harmful, given the law that denies ‘official' smoking zones, such unofficial areas are stress busters for habitual smokers. There are some readers like Pradeep Ghorpade from Mumbai who question the absence of official smoking zones too. Edited excerpts:

As an international traveller, I was impressed by the smoking areas provided in international airports, restaurants and public places. Should we also provide similar smoking areas in our workplaces, and in public places such as airports, railway stations, bus stands and shopping malls? Most co-workers ignore it when one of their colleagues smokes in unofficial smoke areas such as toilets, basements or parking areas. This ensures that the employee does not leave the campus and returns quickly to his work desk or factory shed. 

— Mathew Abraham, RBI, Thiruvananthapuram (HBL)

Don’t let plastic cards melt hard-earned cash

......The biggest risk in all plastic cards, debit or credit, arises when a customer loses the card and his or her signature is there on the card to be easily forged and misused at merchant shops. It may be difficult to eliminate the risk of fraud altogether but here are a few things you can do to mitigate it.......

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NPCI to launch PIN-based debit cards by March

....National Payment Council of India (NPCI), set up by the Reserve Bank of India to promote card payments system, will launch its RuPay debit card in March. RuPay is the country’s first domestic payment card network and aims to match existing payment facilitators such as Visa and MasterCard and provide debit and credit card services........

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Bank of Maharashtra convenes 114th SLBC in Mumbai

Reserve Bank of India calls for dedicated SME verticals at banks

MUMBAI: The Reserve Bank has asked banks to set up dedicated verticals to help small and medium businesses to deal with financial matters. "An SME-promoter knows the product, but he doesn't know finance," RBI Deputy Governor K C Chakrabarty said, speaking at an industry seminar organised by the SME Chamber of India here over the weekend. Banks, which have long-term association with such SMEs as lending partners, can further this relationship by providing consultancy on finance, cash-flow management, taxation and other related things for a fee, he said. "I think this is a product innovation, which needs to be done by banks and it needs to be done across the globe," Chakrabarty, whose responsibilities include customer services, said. A desk should be available centrally that will help SMEs and can handle multiple SMEs, he said. SMEs will have to pay for such service, he said. "I am not saying anything is free, you charge them for that." However, banks should eye volumes in the business and ensure that the costs are low, Chakrabarty added. He also came down hard on the high interest rates charged by banks in lending to SMEs, asking if they can be compared with rates charged to corporates. As a matter of proper governance, Chakrabarty said, "I will be happy if banks disclose this in the balance sheet.”

ET

Banks play safe, favour large firms to SMEs

Banks, saddled with rising bad debt in view of the economic slowdown, are believed to be directing a major chunk of their lending to large companies, choking credit to the small and medium enterprises (SMEs)....................

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What Basel-III norms mandate

....One of the fundamental assumptions of accounting is the concept of going concern. Basel-III norms as issued by the RBI should raise a few eyebrows when they refer to tier-2 capital as gone-concern capital in their guidelines, though it is apparent that this is only to distinguish it from tier-1 going-concern capital. ......

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RBI eases forex restrictions for select PSU and private banks

...... "The RBI wants to ensure that banks make use of the limit for client needs and not indulge in speculation. It may not be the best thing to do, but these are unusual times,"........

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Banks should ensure person offering guarantee is a close relative of borrower

....The Reserve Bank of India, in its recent Financial Stability Report, has identified deterioration of asset quality as the highest risk facing banks. The RBI has also highlighted the fact that the year-on-year growth of NPAs (non-performing assets), at 30.5 per cent, was higher than the credit growth at 19.2 per cent. .............

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Banks ask borrowers to cover their personal loans, overdraft facilities

............ According to bankers, borrowers are being sold the covers under the proposition of ‘no headache to families, in case of an untimely death or even unemployment’. “Borrowers are showing interest because if there is a default due to death, the family will not be pestered or will not be burdened with a loan,” said the retail head of a private sector bank......................

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Is audit losing its relevance?

...... A recent move by the RBI to reduce branch audits of banks has received significant attention of the media. As per media reports, banks have written to the RBI suggesting reduction in branch audit to reduce non-value added costs.It is argued that with concepts like core banking system and centralised record keeping, the relevance of the audit of branches of public sector banks (PSBs) has significantly declined. RBI will definitely decide the issue considering the pros and cons of reducing audit of branches of PSU banks........

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Budget 2012: Agenda for banking sector this year – M.S.Sriram

The government and the Reserve Bank of India (RBI) is half done on financial inclusion. More branches are being opened. Four elements of inclusion have also been articulated: a basic bank account with an overdraft facility; entrepreneurial credit on the lines of a Kisan credit card; an accumulating savings product; and a remittance facility...........

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The data divergence

....On several occasions in the recent past, important users of official data have questioned its veracity. The monthly Index of Industrial Production, which tracks industrial output, has been extremely volatile after it moved to a new series. The RBI has found it to be unreliable for framing monetary policies. The monthly WPI inflation figures have likewise been criticised but the main point of criticism is that, despite some recent improvements, it does not capture the price movements that affect the consumers directly.......

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Banking on India Post

....The Communications Minister, Mr Kapil Sibal, wants the Reserve Bank of India (RBI) to grant a banking license to India Post. The proposal makes eminent sense, especially at a time when financial inclusion has become a pervasive buzzword............

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eMudhra to certify digital signatures for e-banking transactions in Mauritius

....“The RBI in its April 2011 guidelines has given a deadline asking all the banks to comply with Information Technology act. The IT act recognises digital signatures as the only recognised form of authentication for online and electronic banking transactions”......

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