....... India remains an underpenetrated market when it comes to financial services. I believe one of the big changes that we may see with the new wave of banking licences is the focus on innovation to drive financial inclusion. The new banks will look at under-penetrated segments of the market, where existing competition is low, in order to service customers who are currently excluded. The new banks will probably have to develop new, low-cost distribution models. Technology will also play an important role here and I believe we will see the next level of use of technology, especially for analytics. This will result in efficient customer acquisition, better risk management, better customer service and reduce the cost to serve............
The very purpose of VITALINFO is to provide a platform for wider dissemination of updated information related to and happening of events in and around RBI.
Wednesday, January 16, 2013
RBI alerts banks on Bihar-Nepal border on fake note circulation
MOTIHARI: Reserve Bank of India has alerted all the braches of banks in north Bihar adjoining Indo-Nepal border to take serious precaution in transactions of currencies at their counters as this area has been marked as sensitive for circulation of fake currency notes .The RBI circulated a letter directing the banks to take extra precaution in transaction of Rs 100, 500 and 1000 notes and install machines to check fake notes..........
Succession plans
..... The last few years have seen a half-hearted attempt on the Centre’s part to fill vacancies at crucial positions — adversely affecting the Reserve Bank of India and UTI, among others...........
No cause for optimism
.......Given the manner in which the Finance Ministry behaved most petulantly towards Subir Gokarn, the RBI Deputy Governor, refusing to give him another three-year term, more or less the norm for the post, it is quite likely that its wish for a reduction in the bank rate might be fulfilled at the end of the month. Be that as it may, it should be noted that............
Reserve Bank of India Governor Duvvuri Subbarao tempers expectations of rate cut
MUMBAI: Reserve Bank of India Governor Duvvuri Subbarao on Tuesday tempered expectations of interest rate cuts beginning this month, saying prices of consumer products and manufactured items are still rising. Subbarao, who has refused to give in to pressure from industry and the finance minister to lower key rates, said though the rate ........
3,000 new bankbranches in UP by 2014: RBI Governor
...........The chief minister drew the Reserve Bank Of India Governor's attention to the fact that on the basis of 2011 census while there should be a bank's branch for the population of 13,000 at all-India level, in Uttar Pradesh a bank's services are available for the population of about 16,500 people. The chief minister requested Subbarao to bring all districts of Uttar Pradesh at the all-India level for which the Reserve Bank of India governor assured him that 3,000 new bank branches would be opened in rural areas of the state till 2014..........
Primary credit societies need RBI nod to be a bank
........Earlier, under the provisions of Section 22, on becoming a co-operative
bank, a credit society could continue to carry on its banking business
until such a licence was granted by RBI. The Amendment Act now provides
that a primary credit society
will have to obtain a licence to continue its banking business. The
effect of this amendment is that primary co-operative credit societies,
engaged in banking business, shall be required to convert themselves
into co-operative banks and obtain a licence from RBI..............
Banks press RBI on repo, CRR
......RBI committee, headed by B Mahapatra, had recommended abolition of the regulatory leeway given to banks for debt recast and suggested banks must classify a loan as a non-performing asset if restructured. At present, loans can remain classified as standard even if restructured, though the provisioning requirement increases.
Bigger NBFCs should get benefits of banks: Sanjiv Bajaj
...There has been past cases where NBFCs were converted into banks very successfully. But that was long back. We will wait for the final guidelines on bank licences and see what requirements RBI puts down, than decide. I think the criteria will be different for different NBFCs.........
The next step for Indian banking
India’s banks are at the turnstiles. They can go out, graduating to greater strength and playing a more useful role in the economy; or they can go round in circles without changing much. The current juncture is important for several reasons. One, new banking licences are to be issued, focusing attention on the intrinsic health of the sector. Two, after the financial crisis of 2008, the developed world is still grappling with the task of devising systemic changes that will prevent a repeat. Three, a key lesson from the crisis is that deregulation and emergence of mega industry players do not, in themselves, assure sustainable growth. No bank is too big to fail...........
Should industrial houses be given bank licences?
..........The Reserve Bank of India (RBI) is expected to issue final guidelines for licensing private sector banks shortly. Whether the guidelines should allow industrial houses to promote a new bank is hotly debated. This needs to be first understood against the backdrop of how many new banks should be allowed licences..............
FinMin finalises norms for new bank licenses, sends to RBI
T
he finance ministry has finalised norms for new bank licenses and has sent its comments to the Reserve Bank of India (RBI). CNBC-TV18's Siddharth Zarabi reports this exclusive...........
RBI, bankers seek transparent systems for credit flow to MSMEs
.....As part of an earlier policy decision to look into the concerns surrounding the flow of credit to micro, small and medium enterprises (MSMEs), Deputy Governor K C Chakrabarty held a meeting with Chief Executives of banks this evening. .......
Tale of 2 indices: Why CPI is headed north and WPI sout
.........if we are to assume the following events in 2013 – rising fuel prices, rising food prices, and higher taxes – one could predict that the WPI will start moderating faster than the CPI after rising in the initial months. The government will thus want the RBI Governor to look at the WPI and not the CPI this month – and also in the rest of 2013. As things stand, with Subbarao now in lameduck category – his term is due to expire in September – a slow reduction in interest rates is a possibility...........
Here come the rate cuts
...Whether RBI chooses to go in for a rate cut—and 25 bps or 50 bps—will depend on whether it chooses to be consistent or not. Though RBI’s stated policy variable has been the modified core inflation, in recent monetary policy statements RBI has confounded all watchers by changing its goalposts from WPI to core inflation to CPI and even, in the August statement, to the output gap.........
Bankers want RBI to focus on growth; seek cut in repo, cash reserve ratio
......"While inflation concerns remain, growth is a bigger concern...so, while we understand the issues related to inflation at this point of time, it was our recommendation that there should be a rate cut so that growth comes first,"............
RBI’s views may be sought on Coke arm’s extension plea
The Foreign Investment Promotion Board (FIPB) could seek the Reserve Bank of India’s views on Hindustan Coca-Cola Beverages’ (HCCB’s) proposal for delayed redemption of preference shares in favour of its holding company, Hindustan Coca-Cola Holding (HCCH). HCCH is the Indian arm of the US beverages major Coca-Cola. “It is a FEMA issue and thus the RBI has to give a view on it,”...........
Sebi for allowing ETFs to park 20% gold holdings with banks
......"Sebi has suggested this as one of the options to curb gold imports and channelise investment of retail investors from physical gold to gold-linked instruments," a senior government official said on condition of anonymity. In a draft report on gold imports released on January 2, the RBI had also suggested that ETFs be allowed to invest their gold holdings in gold certificates with banks. .............
Delhi mulls further curbs on gold imports to cut current account deficit
......Recently, the Reserve Bank of India executive Director Deepak Mohanty urged investors to shift from physical gold as a hedge against rising prices to financial products like inflation-linked bonds. While the CAD was indeed worrying, Chidambaram said it was within India’s capacity to underscore the crucial importance of FDI and FII.............
NABARD asks OSCB to set up FLCs in state
With an aim of educating rural people about banking systems in the state, NABARD has approached the Odisha State Co-operative Bank (OSCB) to play a major role in establishing Financial Literacy Centres (FLCs) because Co-operative Banks have wide grassroots presence in the state. Meanwhile, NABARD authorities have asked the OSCB to allow each District Cooperative Bank to start FLC at least in one block as part of the endeavour to educate rural masses on banking system...........
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