RuPay: With this RBI initiative, India gets ready for a cashless revolution

The Reserve Bank of India deserves to be commended for the initiative it has taken to launch RuPay, an indigenous, cheaper alternative to the card-based payment systems such as Visa, MasterCard and American Express. It got local banks to promote a not-for-profit National Payments Corporation of India (NPCI), the author of RuPay, which offers the same services offered by Visa and MasterCard, but at a much cheaper cost…

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RBI asks MFIs to use local language for agreement

The Reserve Bank of India wants micro-finance institutions to have their loan agreements cleared by their boards, preferably in the local language. In the revised guidelines on fair practices for the recently-created non-banking finance company-MFI category, it has also asked them to use a standard form of loan agreement to achieve greater transparency...........

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Cheque the writing on the wall

“Can you please send a cheque?” This question could become a joke in a few years. If you doubt it, can you tell when was the last time you received or sent a money order? There may be some who would have received or sent one recently, but the number of people using it seems to be on the decline........

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Govt may amend Act to make Aadhaar data valid ID proof

...... We had included the letter of Aadhaar containing the name, address and number as an official valid document in PMLA. Now we are looking into whether the electronic Aadhaar authentication can also be included as a valid KYC,” said a finance ministry official who did not want to be identified. “In principle, we have no objections to this.” The finance ministry has written to all entities, including the Reserve Bank of India (RBI), the Financial Intelligence Unit and the home ministry for their views on the safety aspects of such a move, he said. ……

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'Banks Can't Freeze Accounts If KYC Papers Not Given'

The Gujarat High Court has ruled that banks cannot freeze accounts nor can they stop issuing cheque book or providing ATM facility where the account holder has not supplied KYC (Know Your Customer) documents...........

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No respite for existing home loans as banks cut rates for new borrowers

When it comes to increasing home loan rates, banks believe in following an across-the-board policy and hike rates for all and sundry. However, in case of reduction, the policy is aimed to benefit only new borrowers as lenders try to grab more market share………….

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NO RATE CUT ‘Go to banking ombudsman’

New Delhi : In a bid to garner a greater share of new home loan borrowers, banks are cutting lending rates for them while maintaining old rates for existing customers. Coming to the lenders’ defence, bankers said that the base rates have not been changed by IDBI Bank and Canara Bank, and the lower rates should be seen as “special offers”. An official in a regulatory agency said that old borrowers could move to new rates by paying a “reasonable” conversion charge, an offer that is available for several banks such as State Bank of India and Housing Finance Companies (HFCs). A top RBI official said, “Banks can’t discriminate between old and new customers”, but advised borrowers to approach the ombudsman with their grievance. The regulator for HFCs such as HDFC and LIC Housing Finance, however,seems to be one up on RBI. “We recently issued a clarificatory circular asking HFCs to migrate all borrowers to a risk profile-based regime by April 30,” NHB chairman R V Verma told TOI. So, irrespective of when you have taken the loan, if your risk profile matches someone’s who borrows from the same HFC today, you are entitled to the same rate. How do you find that out is a different matter, unless the regulator comes up with a risk profiling system and ask lenders to make it public. NHB is not doing so at least now.  “It’s a process that will mature over a period of time. Different HFCs will have their own risk assessment and as the system matures, seasoning of the methodology will happen,” Verma said.

TOI

Know your customer or keep away that customer? -T.V. Gopalakrishnan

.....It is no wonder that financial inclusion does not take off — most people would prefer to remain outside the banking system than comply with the Know Your Customer (KYC) norms of banks as reportedly prescribed by the Reserve Bank of India. My experience with the country's largest bank, the State Bank of India, is something worth recording to bring to the authorities' notice that the KYC procedure should be a simple one to understand your customers and not to keep away or kill your prospective customers...........

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Fake notes entering UP via Nepal

……The Reserve Bank of India (RBI) and other nationalized banks have recently drafted a detailed list of security features on currency notes which can detected by common man and do not require a gadget or an expert to establish if the currency is counterfeit or genuine.

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Raise provisions to keep banking healthy

.... I can’t recall another instance of RBI buying bonds from banks just ahead of the close of a fiscal year and after the completion of the government’s borrowing programme. In……

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Indian Overseas Bank asked to pay Rs 10k as damages to widow

....... "By not following the guidelines of the Reserve Bank of India (RBI), the bank caused hardship to the complainant (Seema), who suffered after the death of her husband and could not pay the school and examination fees of her son. The act of the bank has caused deficiency in service," the forum said…….

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RBI asks cops to probe counterfeit currency

….The Reserve Bank of India has approached Delhi Police to take action against some people who they suspect deposited forged or counterfeit currency notes at banks this month…..

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RBI needs to enable, not disable

RBI must recognize the mandate and the mission of local banks and be more sensitive to the needs of peripheral economies in the country

….Reserve Bank of India (RBI) governor D. Subbarao, during a visit to Jammu recently, seems to have been disturbed by the abysmally low level of credit-deposit ratio—just 35% in 2011—in Jammu and Kashmir (J&K). For a professional, this reflects a rather poor state of banking affairs. But for the local businessmen it is a way of life. A credit-deposit ratio of 35-40% has been an endemic feature of the state for almost as long as one can recall; except for a brief interlude.…..

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‘Next 30 years will be most happening for all banks'

.....Union Bank of India is aiming to become largest public sector bank in domestic operations after State Bank of India by 2020, which is its centenary year, said Mr M. V. Nair, in an interview with Business Line just before he retired on March 31. With this in mind, the bank has started taking steps like wooing the Gen Y customer through its remodelled branches and technology offerings, as also tapping the unbanked population. ..........

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RBI must address the factors responsible for liquidity crunch

….The reduction in CRR was, in fact, at odds with the stated position of the RBI governor and other top officials of the bank who had repeatedly stressed that the battle on the inflation front is far from over. Yes, the RBI had intervened to shore up the exchange rate of the rupee vis-a-vis the dollar in the closing months of the last calendar year. Yes, forex inflows had slowed down impacting that reserve money creation. Yes, broad money growth was lower than in the comparable period last year, but then so was the level of economic activity…..

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MSCB misses deadline for banking licence

The Maharashtra State Cooperative Bank (MSCB), which is under administrator’s rule since May, has missed the March 31 deadline for getting a banking licence from the Reserve Bank of India. The state cooperation department confirmed this development saying that the delay was due to procedural issues. The department said it hoped RBI to issue the licence on Monday or this week, as it has reconfirmed fulfilment of necessary criteria with RBI and Nabard. The banking licence for MSCB was made mandatory according to the Rakesh Mohan Committee report.…..

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Treat education loans as national investment: Coimbatore Collector tells bankers

Mr M. Karunakaran, District Collector of Coimbatore, urged bankers to concentrate on education loans and look at the education loan portfolio as a national investment instead of considering it as an unrewarding advance. He made this remark after unveiling the Annual Credit Plan for 2012-13, which envisages 18 per cent growth over the earlier year's outlay of Rs 5,315 crore......

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FIIs remitting funds abroad may face tax liability

…..As per Reserve Bank of India (RBI) rules, FIIs have to furnish a clearance statement signed by professional accountants to custodian banks for transferring funds overseas. "The dilemma is most accountants will prefer putting in a caveat since there is no full clarity on the tax issue….

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Finances of State power utilities, precarious: RBI

The financial condition of power distribution utilities in the country is precarious, according to a Reserve Bank of India report. The report also expresses concern over the large exposure of public sector banks to these utilities..............

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Regulations around savers, please

….The products and the selling process in both cases are supposedly created and designed with you, the saver, in mind. But are you in the picture at all? Especially after you add a third major player and its regulator to the scene — banks and the Reserve Bank of India (RBI). Anecdotal evidence shows that among the biggest sources of mis-selling are banks — possibly because they enjoy the trust of the savers, have access to their data, and are large impersonal organisations……

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Foreign policy to decide banks' foray abroad

FinMin talking to home ministry, RBI for guidelines on PSB branches outside India

The finance ministry is in talks with the home ministry and the Reserve Bank on guidelines for expansion of public sector banks (PSBs) abroad, in sync with India’s relations with other countries…

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Kolkata Mint celebrates Diamond Jubilee

…….Mukherjee, who reminded the audience of the “history that is associated with the Mint”, cited the importance of fighting currency forgery. “In today’s world there are many ways of causing harm to a state and one such way remains the process of counterfeiting which can not only make the people lose their trust on the government but also cause harm to the economy. At one point it was quite high but today we have come a long way from that situation,” he said…….

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WB has competitive strengths in some industries, says Gokarn

……………"West Bengal is exploring a long-term strategy for industrialisation as the relative growth performance in the last decade was not encouraging," Gokarn said at a seminar on West Bengal organised by industry body Assocham here today…………….

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Gold loan firms hit a wall in cash hunt

.....“RBI wants to tighten the noose around these companies for the way they have been raising funds indiscriminately through NCDs and deposits. Imagine, a single company raising funds through a new instrument like retail NCDs thrice in a matter of six months. If something goes wrong, people will lose faith in the instrument itself,”.....

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Five reasons why the Bankex rally ran out of steam and will remain so

.... Apart from that, the dangers from a fiscal slippage and further pressures from hikes in under-priced fuel and power remains. Thus, even if there are rate cuts in the June quarter, it is likely that the RBI will follow its “baby steps” policy.

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