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| ......"Applicants for new bank licences will be required to furnish their business plans for the banks along with their applications," the guidelines issued by the Reserve Bank of India said. "The business plan will have to address how the bank proposes to achieve financial inclusion."....... |
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.
Saturday, February 23, 2013
Financial inclusion must for new banks
High asset price volatility clause may be a hindrance
.....Although RBI did not exclude any sector in the guidelines, the wordings in the circular have raised concerns on whether real estate and broking firms would qualify. Both these business are considered volatile, as stock markets and real estate are known to have a speculative element in them.......
Experts' cheer mixed on RBI’s bank-licence guidelines
 |
| ..........."As a regulator, the RBI will have to study the merits of every application and check if it meets the stipulated requirements before issuing a licence. That's a very fair way of moving forward," he says. "The banking entity also will be able to lend to companies in the group but will not be able to invest in them."........... |
More clarity required on RBI's new norms: M&M
.......The clarity on transition provisions for existing NBFC was very nice. The guidelines and the sentence, that existing NBFCs would be permitted to convert themselves to or alternately promote a bank. That is the option given. However, one would need more clarity on the transition provisions and how they would apply..........
Stiff banking conditions
..............some of the conditions appear stiff—asking new entrants to ensure that 25% of their branches are located in unbanked rural centres seems unfair since it would pressure the banks’ profitability in the initial years. Since banks need to list on the exchanges within three years of starting operations, they could have been given some time to expand their presence in the hinterland. In any case, forcing rural obligations has not worked in the past for any sector.............
India Post to enter banking space
.....The Reserve Bank of India on Friday issued the much awaited guidelines for new banking licences. Among other terms, new banks should open at least 25 per cent of branches in unbanked rural centres. Of the 1.55 lakh post offices, around 24,000 district offices may be ready to offer banking services in next two years. Post offices are being enabled by core banking solution's connecting nationwide branches as part of an transformative IT project......
Corporates keen to enter banking space, welcome RBI norms on new licences
M&M, Reliance Capital and players in the financial services space today welcomed Reserve Bank's guidelines for issuing licences for new banks and showed keenness to enter the business. Yielding to government's stance, RBI today allowed corporates and PSUs with sound credentials and Rs 500 crore to invest as paid-up capital to set up commercial banks...........
Religare optimistic on RBI's guidelines on banking licence
..........Any financial services company, even at Religare today, our board is largely independent. One is governance and the other one is shareholding. RBI clearly indicates that if any bank is not largely directed in any way controlled by a promoter group and is governed in a very dependent manner then it is a welcome and de-risking attitude that the RBI has taken. So, I don't think it is very positive from that context.
Assam Police launch operation against fake non-banking financial companies
GUWAHATI: The Assam Police with the help of the Reserve Bank of India (RBI) has decided to launch an extensive operation against dubious non-banking financial companies (NBFCs) in the state. To ensure that the initiative is effective, the state police have decided to impart technicalknowhow about NBFCs among investigating officers (IOs).......
My View on "Wage Revision Remains in Cold Storage...."
The observations are correct. However, IBA has called AIBOC and AIBOA on Feb 22,2013 for wage revision talks. As usual, the minutes of negotiations would not be maintained, the talks are exploratory in nature and Assns are not interested in early settlement.The prime reason is levy and importance garnered by the leaders. Pl remember that PAY COMMISSIONS composed of 3 to 5 members give much hefty rise than what you get in bi partite collective bargaining.
- Sitendra Kumar
Centre should perhaps consider a quick review by such an expert group which should go into the adequacy of wages, minimum and maximum remuneration across sectors, their relationship to lifestyle needs of employees and paying capacity of employers and the need to factor in social security needs like healthcare and old age care in wages. The findings of such a study will help government in providing some broad policy guidelines to be followed by industries across public and private sectors, while negotiating wage structure. Transparency in policy will go a long way in reducing sporadic eruptions emanating from suppression of genuine human aspiration for a reasonably comfortable life, safe and secure in all respects.
- M.G.Warrier
Unclaimed deposits of over Rs. 2,481 crore in banks till December 2011
........in the Banking Laws (Amendment) Act, 2012, a new section has been inserted in the Banking Regulation Act empowering the RBI to establish the 'Depositor Education and Awareness Fund' for the unclaimed deposits lying with any bank for more than 10 years. "This fund will be utilised for promotion of depositors' interest and for such other purposes which may be necessary for the promotion of depositors' interest as may be specified by the RBI from time to time,"...........
Banking fraud total jumped 43% to Rs 52.66 cr in 2012: Govt
..........He said the RBI has asked banks to take preventive measures to combat frauds relating to skimming or duplication of credit cards. RBI has also advised banks to set up internal control systems to combat frauds and to take pro-active fraud control and enforcement measures to ensure that credit card operations are run on sound, prudent and profitable lines. Moreover, it has also cautioned banks on phishing attacks containing details of the modus-operandi on such attacks and minimum set of preventive measures to tackle phishing attacks.......
AP High Court ruling has sent MFIs back to square one
......"The directions issued by the Reserve Bank of India coupled with the provisions of Chapter IIIB of the RBI Act will protect the interests of the self help groups from usurious interest rates and coercive means of recovery.... Apart from this, the Micro Finance Institutions (Development and Regulation) Bill, 2012, introduced by the Central Government in the Lok Sabha is a complete code in itself as regards the micro finance institutions. Once that Bill takes the shape of an enactment, we are of the opinion that it will govern every aspect of the micro finance institutions at all levels and in all respects and all the issues raised by the petitioners herein. In such circumstances, it would be a futile exercise for this Court to examine the legislative competence or otherwise of the State to legislate the impugned enactment, therefore, we have not gone into the same."......
Empower the Fiscal, Don't Weaken It - Y.V.Reddy
.....The term I use is fiscal empowerment. In countries like India, you should not look at just reducing the fiscal deficit. In fact, you should have more expenditure. In the future, there will be a greater demand for water, sanitation and public health. Can the private sector provide that? Ultimately, it is the fiscal that gives you the capacity to mitigate risks, handle the financial sector instability etc. So in my book, I argue: Empower the fiscal, don’t weaken it.........
Govt mulls new deposit scheme to bring down physical gold demand
.....The scheme to be operated by post offices in rural areas besides select Public sector banks as authorised by the Reserve Bank of India (RBI), involves primarily a fixed deposit account with varying periodicity as offered by banks today but with one exception. The balance will be maintained in terms of gold units (in grams) and not in cash by converting the amount deposited in the account into gold units based on bank’s gold selling rate of the bank. This rate will be fixed by the..........
From bridal baubles to bullion bars, India's gold culture defies curbs
......Gold has been deeply entwined in Indian culture for thousands of years. Nowadays, India is by far the world's biggest buyer of gold and those imports are an increasing drain on an economy that is growing too slowly to reduce widespread poverty. Last year Indians imported 864 tonnes of gold, about one fifth of world sales.........
Corruption cloud over budget session
..........While the Finance Ministry and corporate captains have blamed the Reserve Bank of India for not lowering interest rates until recently, the RBI has stuck to its guns that one of the primary goals of monetary policy is to lower inflationary expectations. As RBI Governor D. Subba Rao succinctly put it: “People who are worried about economic growth are typically quite articulate, that they have a platform to express their concerns…I have sympathy with that view (that high interest rates had slowed down growth). I am not saying that’s an invalid criticism. But I just want to say that their voice is heard, but people who are hurt by inflation -- the large majority of the poor -- their voice is not heard.” The RBI Governor’s statement could not have been a sharper indictment of the government’s economic priorities. Many believe the government is courting political disaster.
Friday, February 22, 2013
Allow the rupee to depreciate - S.S.Tarapore
...............The Reserve Bank of India (RBI) which, for a very short period in the latter half of the 1990s, revealed the CAD-CR ratio, has quietly buried this figure in its mass of balance of payments data. The RBI should highlight the trends in the CAD-CR ratio in its forthcoming Annual Report. As Y.V. Reddy has perceptively commented recently, one cannot have a single CAD-GDP ratio which is appropriate over the cycle. If the CAD-GDP ratio is 5 per cent at a low point of growth how much higher would it be when growth gets back to a trend line of, say, 8 per cent?............
A real currency war
.......Coming back home, the rupee volatility has been declining despite the thin market imposed by the Reserve Bank of India. However, any upsurge in global volatility would certainly upset this tentative calm and make risk management even more difficult — be very careful.
UK govt bows to public pressure—rejects abolition of cheque system. Will RBI follow suit?
....It is surprising that while the decision of a tiny country like Ireland to abolish the cheque system is fairly brought out in the discussion paper of the RBI in support of the proposal, the decision of the developed country, the Mecca of banking like Great Britain to completely shelve the idea has not even found a casual mention in the discussion paper, though the decision in UK to scrap the project was taken as early as in July 2011—much before this proposal was thought of by the RBI.......
In hoax we feel happy..........
-------- Original Message --------
Subject: PAYMENT NOTICE OF 7,50,000GBP FROM RESERVE BANK OF INDIA!
From: Reserve Bank of India <info@rbi.org.in>
Date: Wed, February 20, 2013 9:22 am
To: undisclosed-recipients:;
OPEN THE ATTACHED FILE AND REPLY WITH YOUR COMPLETE DETAILS TO THE
TRANSFER DEPARTMENT OF RESERVE BANK OF INDIA
<PAYMENT NOTIFICATION OF YOUR FUNDS..docx>
Pl. see the above mail received by my daughter. Such frauds are increasing day by day. Even RBI is not spared. This must be circulated to all RBI'ts.
- C.P.Sonak, Ex-DGM
I am thinking of sending a hoax mail to all retired people that their
PENSION UPDATION case has been cleared at the highest level.The real
mail we do not get, at least the hoax makes us feel on par with Ambanis
and Mittals.
- Sitendra Kumar, Ex-GM
Wage Revision Remains in Cold Storage - 2 Day Strike by Bank Staff - UFBU needs to draw its strategy
...... I think at this time, the top most agenda item which every banker wants to discuss is the 10th BPS, which has become due from 1st November, 2012 i.e. almost now it is 4 months overdue. For certain sections of retired bankers the core issues to be resolved are - 2nd pension option to resignees etc, 100% DA neutralisation to pre-01/11/2002 retirees, and updation of pension. I think, there will be hardly any bankers who will disagree with me on this issue except some hardcore UFBU leaders. If this is true, then question arises why UFBU decided to waste its energies on political issues which are not likely to bring any results for the bankers or the country............
Indians prefer to put their retirement savings into cash deposits: HSBC
..........."When the economic downturn first hit and many people reduced or stopped saving, everyone expected the storm would eventually pass; but today's shifting economic and social trends require people to think differently about their planning and prepare for the unexpected,"..........
A Budget for savings?
......The Reserve Bank of India also has to balance the interests of domestic industry (calling for quick and substantial cuts in rates) and those of savers. A move to aggressively cut rates may further push savers out of financial assets. Even today, bankers are reluctant to cut deposit rates, since deposits are only growing at 13 per cent. A substantial reduction in lending rates looks tough, unless deposits start growing again. Unless the pool of financial savings can be significantly enhanced, deep rate cuts by lenders are just not possible.........
A budget in the shadow of record current account deficit
..... Well, the Reserve Bank of India (RBI) believes the country’s sustainable current account deficit is 2.5% of GDP. It’s far above that level now, and the massive gap has to be financed through capital inflows, which makes the Indian economy completely dependent on the kindness of foreigners. Any loss of confidence in India’s growth prospects, any lessening of global risk appetite, and fund flows to the country’s markets could start drying up, dragging down the rupee and leading to a stampede for the exits.......
Pvt Banks Take Country Roads to Keep Competition at Bay
A few
private sector lenders have started strengthening their rural presence
as they prepare to take on competition from new players who are being
granted licence as part of the government’s financial inclusion plan.
While HDFC Bank is reaching out to the rural community on its own, Axis
Bank and Yes Bank are working through business correspondents, or local
representatives, and tie-ups. The push into these regions, though not very lucrative, is also in part due to the saturation in the urban areas........
A walk on the wild side
.........Pressures to spend will always exist, says Subir Gokarn, an economist and former bigwig at the RBI. In areas such as education and infrastructure, that is only right. So revenues need to rise. A new report by the IMF compares India with other countries, adjusting for their wealth. It implies that India’s government revenues should be 25% of GDP. At present they are just 18%..........
Growth versus Inflation
........The Reserve Bank of India (RBI) may take pride in claiming, even if in jest, that it has prevented a “big bang collapse” and that in pursuing higher growth and lower inflation, it has reduced the repo rate and cash reserve ratio (CRR) by 0.25 percentage point each in its latest policy statement of 29 January 2013 (RBI Post-Policy Conference Call for the Media). However, it is not surprising that the domestic financial markets have uniformly reacted adversely to the measures on the ground that the RBI policy correction was too meager and that it has come a long time after the economy had slipped into a morass of depressed business conditions..........
RBI officials fear budget choices give less room for rate cuts
.......Yet, officials in the Reserve Bank of India fear that cutting capital spending on projects with strong multiplier effects like building roads and bridges, won't help revive growth, which is seen as a priority if the economy is to avoid a downward spiral. And they also worry that maintaining populist spending on subsidies for food, fuel, fertiliser and cooking gas will push up prices......
Realtors, brokers to get RBI lifeline
The Reserve Bank of India (RBI) has softened its stance on allowing real estate firms and brokerages to apply for banking licences. Sources familiar with the developments said the final guidelines, to be announced by the end of the month, would set aside its earlier reservations about these entities............
RBI works comes standstill due to staff strike
JAMMU, Feb 21: The local units of RBI Workers Union and Reserve Bank Employees Association observed two days’ strike on February 20 and 21 on the call of All India Central Trade Unions. They were protesting against the failure of the government to control price rise, worsening economic conditions, outsourcing of work, exploitative and anti-labour policies of the government. The work in Reserve Bank of India came to a standstill due to the strike. The protesting employees held massive demonstration at the gate of the RBI building at Jammu under the aegis of Jammu Chapter of United Forum of Reserve Bank Employees and Workers. Later the leaders of the constituents of the United Forum including BS Kirola, Secretary, Reserve Bank Employees Association, Supen Kumar, Chief Secretary, Reserve Bank Workers’ Union, Raj Kumar, President, Reserve Bank Workers’ Union, among others. The speakers highlighted the importance of the issues being agitated by the trade unions all over the country.
Kashmir Times
Over 4 million cheques worth Rs. 250bn remain unprocessed
.........“About 4 million cheques worth about Rs. 250 billion could not be processed on Wednesday in various clearing houses of National Payment Corporation, RBI and SBI. Clearing operations were totally affected in all the district and town centres also.”............
ATMs act as saviour for citizens
Outsourcing of work to fill cash in the automated teller machines (ATM) acted as a respite for ATM users in the two-day period of bandh. Despite banking services getting disrupted, the ATMs did not dry up on February 20 and 21...........
Rs. 2,000 cr transaction blocked in banks
Terming the two-day nationwide bandh call opposing the anti-labour policies a success, joint secretary of National Organisation of Bank Workers (NOBW) Prakash Deshpande said that transaction of Rs2,000 crore was blocked in banks...........
Inflation- fired bandh
....Among the slew of demands, the most appealing to large sections of the people was the one about taming runaway inflation. The poor and the middle- income groups are hit the hardest by the doubledigit price- rise. The failure of the government to rein in fiscal deficit lies at the heart of the inflation problem. In real terms, incomes of salaried classes and of the vast numbers in the unorganized sectors have shrunk in recent years.......
Banking, transport sector hit on day two of nationwide strike
.....“A majority of ATMs have dried up while (bank) branches are shut. Additionally, there has not been any cheque clearing as personnel from RBI too joined the strike. It will take at least 2-3 working days to clear the backlog for banks”, said All India Bank Employees Association Vice President Vishwas Utagi.....
Banks, industry must work together: Anand Sharma
Union minister for commerce Anand Sharma on Wednesday said industrialists and banks should engage in meaningful dialogue to facilitate investment and growth and address challenges facing the economy. The minister also asked banks to lend to small entrepreneurs, artisans and weavers at affordable costs. “Economic activity is not an option but a priority and a national imperative,” Sharma said while speaking at the FE Best Banks Awards..........
Indian banks need to raise Rs.2.7 trn by March 2018
Indian banks need to raise Rs.2.7 trillion by March 2018 to meet the capital requirements mandated by Basel III international standards, Crisil Ltd, the local arm of global rating agency Standard and Poor’s, said on Thursday. The Reserve Bank of India has already issued capital regulations that domestic banks have to start complying with in phases from April. Of the Rs.2.7 trillion Indian banks need to raise, a minimum of Rs.1.3 trillion should be raised as equity capital and up to Rs.1.4 trillion as non-equity funds, Crisil said in a statement........
Mounting NPAs offer little respite to public sector banks in third qt
The October-December quarter brought little cheer for public sector banks that are still struggling to manage their asset quality and keep net interest margins (NIMs) from falling. Bankers say restructured loans remain an overhang, especially in sectors like.........
NBFCs likely to get tax treatment parity with banks
.......Like other lenders, NBFCs too follow the Reserve Bank of India's (RBI's) prudential norms and defer income regarding their NPAs and make provisions for the same. However, income tax authorities do not recognise these norms and tax NBFCs on such deferment of income on accrual basis resulting in tax on unrealised income. Sources in the department of financial services said the government is "positively inclined" to offer tax parity to NBFCs and the other lenders describing it a "reasonable demand" and hinted that the Budget could announce this change...........
Former LIC chief takes charge as Irda chairman
It’s a comeback any professional would dream of. Less than two years after he was demoted to managing director of Life Insurance Corporation (LIC) following charges of financial irregularities, something that eventually prompted him to take voluntary retirement in November 2012, T S Vijayan was appointed chairman of the Insurance Regulatory and Development Authority (Irda), the country’s insurance regulator. An Irda statement said Vijayan had taken charge with immediate effect...........
Thursday, February 21, 2013
Dr Reddy’s prescription
..........At this stage, when policymakers across the globe are trying hard to find answers to possibly the most difficult questions of recent times, Y.V. Reddy, former Governor of Reserve Bank of India (RBI) and the chairman of the 14th Finance Commission, has put forward his assessment and policy prescription in his new book Economic Policies and India’s Reform Agenda: New Thinking, which could be a useful guide for economic management in an otherwise complex world. ..........
It takes a lot to win an FE Best Banks Award
Competition for the coveted FE Best Banks Awards seems to get keener with each passing year. Contenders need to be not just profitable, cost-efficient and demonstrate their ability to grow, they must have clean balance sheets. Invariably, the winners are those who also happen to be tech-savvy, customer-friendly and innovative. This time around, HDFC Bank has been ranked number one in the new private sector bank category with Kotak Mahindra Bank making it to the second spot. Bank of Baroda has been judged the best PSU bank. ...........
OTM - The trainer, now no more.........
Shri O.T.M.Nambiar passed away on 18th February in Neeleshwaram, Kasargod. He was 92
years old and was not well for some time. He leaves behind his wife and 2 sons.
A large number of RBI Officials were trained by Shri. Nambiar as he was a
Faculty member for a long time. He worked as Currency Officer in Bombay and
retired as Manager in F Grade and was later on deputation with the Indian
Bank.
May his soul rest in peace.
- P.P.Ramachandran,
Ex-DGM, DBOD, Mumbai
Extremely sad
to learn the demise of OTM. He was in the then Madras office as Manager
(Regional Director now). A man of high understanding, had both head and heart
for the institution. He was liked by one and all in the centre.
- S.R.Badrinarayanan, Ex-Manager, RPCD, Chennai
I am deeply shocked about the sad
demise Sri Nambiar. I had worked under him in Hyderabad office when he was the
Manager. I felt he was very soft spoken and deeply religious.
- C.S.Murthy, Ex CGM-in-Charge, RPCD, RBI, CO
Mumbai
SC seeks details of banks’ loan waivers
The Reserve Bank of India (RBI) is expected to provide by Friday details of loans waived off by banks or allowed one-time settlements above Rs 10 crore by them, following a Supreme Court direction to this effect last month. Such information, collected by RBI on the basis of annual financial inspections, is to be furnished in a sealed cover as the central bank is reluctant to put it in the public domain.........
Bank credit up 16.36%, deposits increase 13.2%
As of February 8, bank credit had increased 16.36 per cent year-on-year. For this financial year, the Reserve Bank of India (RBI) had estimated it to grow 16 per cent. According to RBI data, advances by commercial banks rose Rs 7,17,180 crore year-on-year to Rs 50,99,909 crore. Bankers said by March-end, growth might stand at about 16 per cent or lower, owing to the tepid demand for loans.........
Banks step up efforts to prevent credit card frauds
......American Express is introducing a new solution, ‘ezeClick’, for its customers in India to ensure their card data is not shared with merchants while making online transactions. Currently, an individual has to share information such as card number, expiry date and card verification value during online credit card transactions...........
Virtual cards can keep you safe from credit card frauds
.......Virtual cards are issued by a few banks and individuals can get more than one card at a time. These can be obtained by registering with the bank that has issued you a credit card. You need to do a one-time registration after which you will get a 16-digit number along with a CVV2 number (this is different from the CVV number mentioned at the back of your credit card). This is the number that you would need to key in when doing an online transaction............
Improve Currency Mgmt Ops: Finmin to Banks
....."We have asked banks to undertake a review of the bin occupancy in each
of their currency chests and put in place an effective management
information system for cash management," said a finance ministry
official, who did not wish to be named. The committee has suggested that
bin occupancy in rural areas should be limited to 40% of the VHL. Bankers feel that RBI should issue consolidated guidelines over
currency management operations that should cover security issues and
provide incentives to efficient banks. "Security is a big issue for us. Besides, the rates of incentives were also fixed long ago and have not
been revised," said a senior official with SBI, the country's biggest
lender. The committee also recommended that the Reserve Bank of India
should initiate discussions with the states for providing a dedicated
force for guarding banks' currency chests..........
Allowing corporates to run banks risky, says former advisor to Government
.......Dr. Virmani’s comments assume significance in the light of the comments from officials of the Reserve Bank expressing their apprehensions about the move, which follows amendments to the Banking Regulation Act in the last session of Parliament. The actual rules under the legislation, determining which entities will be allowed a banking license have not been issued. Significantly, countries such as the United States and South Korea do not allow industrial houses to establish banks. In other countries, such as Australia, U.K. and Canada also enforce restrictions on the extent of foreign ownership and set limits on voting rights. Even the IMF had warned in January that the benefits from allowing such ownership were outweighed by risks..........
Strike hits banking operations
...........All India Bank Employees Association (AIBEA) General Secretary C H Vekatachalam claimed clearing operations, electronic fund transfers, forex transactions and money market operations were completely disrupted across the country. Bank unions are pressing for early wage revision of employees, which they said is due from November 2012. They are also opposing banking sector reforms and any plan for merger of banks..............
Unions say strike successful, around 40 lakh cheques worth Rs 25,000 crore remain unprocessed
....."As per reports reaching us from various states, the strike has been observed very successfully in all banks across the country. Employees and officers from all banks including Reserve Bank of India (RBI), State Bank of India (SBI) and other public sector banks, old generation private banks, foreign banks, regional rural banks, and Cooperative banks participated in the strike.” He said, “About 40 lakh cheques worth about Rs25,000 crore could not be processed today in various clearing houses of National Payment Corporation, RBI and SBI. Clearing operations were totally affected in all the district and town centres also.”.....
RBI tightens norms for import of precious, semi-precious stone
........"It is clarified that Suppliers' and Buyers' Credit (trade credit) including the usance period of Letters of Credit opened for import of precious stones and semi-precious stones should not exceed 90 days from the date of shipment,"...........
Merger Woes
This
refers to ‘IDBI’s Worst may be Over, But…’ (ET, Feb 20). There is a
reference to the merger of United Western Bank (UWB) with IDBI Bank. The
fact is UWB was practically gifted away by the RBI to IDBI. There were
better offers from other financial entities, but the RBI, for unknown
reasons, favoured IDBI. The valuation method employed by the RBI is
still not known after over six years of the merger. Ironically, IDBI had
115 branches when it took over UWB, which then had 230 branches! The
smaller customers in the area of operation of the UWB feel alienated
after the merger as there has been a change in the culture of the bank
that now seems to favour richer customers.
- SHAILESH KOKANE (ET)
- SHAILESH KOKANE (ET)
Bankrupt rhetoric of inclusion
.....When central bankers, following the C. Rangarajan committee set up soon after the 2006 Budget speech, talk, and they do so ceaselessly, of financial inclusion, it seems as if they have in mind a section of the population from another planet, a people forgotten by the mainstream economy in its rush towards self-fulfilment: Exclusion and inclusion are viewed as binary, mutually opposing modes of existence. Banks, we are told, have to replace the usurer both in the rural and urban areas, the landless and the construction migrant worker have to be financially included as a first step towards social inclusion: Informal mechanisms have to be replaced by formal ones.........
District consumer forum orders HSBC Bank to pay Rs 25,000 for deficiency in service
.....“We hold opposite party (HSBC Bank) deficient in service in not informing CIBIL of settlement of all outstanding dues of complainant...,” the bench presided by CK Chaturvedi said. It directed the bank to issue a no-dues certificate to Delhi-resident Vinay Chola and to reconsider a fresh card for him. The forum also awarded him compensation of Rs25,000 towards litigation charges and harassment caused to him........
Responding to the global currency war
....Even if it is assumed that India will keep borrowing easy by liberalising the capital account to fund the current account and push currency to higher levels, the idea is being increasingly questioned. As per the former Deputy Governor, RBI S. S. Tarapore, with our inflation rates persistently above that in major industrial countries, the present dollar-rupee rate should be close to Rs 70. Recently, another foreign exchange expert commented that the rupee should be at least Rs. 60. While this debate can go on, considering the present global macroeconomic scenario and the fact that India is a major importer of oil, we cannot afford either huge appreciation or depreciation from the present level........
Wednesday, February 20, 2013
Effectiveness of interest rates limited when fiscal position stressed
‘Foreign exchange has emerged as a critical resource’
......Savithri V. Ramani, Senior Officer from the Reserve Bank of India, Chennai, detailed various activities of the Foreign Exchange Department of RBI. With Foreign Exchange Management Act (FEMA), which was effected from June 1, 2000, the objective of RBI had shifted from conservation of foreign exchange to facilitating external trade and payment and promoting the orderly development and maintenance of foreign exchange market in India. “RBI has brought in structural changes in exchange control administration and framed certain transparent regulations for dealing with various types of foreign exchange transactions. Foreign exchange has emerged as a critical resource with a direct relationship to economic performance at a time when the share of the external sector in the national output has soared significantly. The integration of the world economy over the past two to three decades has been dramatic and the real gainers from globalisation are the developing countries that have been able to seize the opportunities to participate in the process,” she added........
Portable ATMs gain popularity among banks
......Private sector banks have started introducing mobile ATMs that are migrating from one religious fair to another throughout the year. HDFC Bank, the second largest private lender in the country, has sent its mobile ATM to the Maha Kumbh Mela in Allahabad this year. It is estimated over 100 million people will attend this year's Maha Kumbh Mela, which began last month........
Worn-out currency can be deposited at a bank
......Well, the Reserve Bank of India (RBI) regulations say that under special circumstances, the central bank may exchange such notes. And it has mandated every bank to have designated branches to provide the facility of exchanging such notes. So you can visit these branches and get such currency notes exchanged or deposited but there are few conditions you need to keep in mind.............
A growth budget all the way
.......Even RBI is very puzzled as to why India’s inflation rate, historically moderate and lower than most emerging economies, is among the highest in the world since 2010. In a recent public address, RBI’s Executive Director and a reputed monetary economist, Deepak Mohanty, described the current phase of growth collapse and elevated inflation as a big puzzle. He said in 62 years since 1951, India’s WPI inflation rate was 6.7%. “This was not a very high rate considering many developed and developing countries experienced very high inflation in their modern development history. World inflation averaged around 17% in the 1980s and 1990s.”.........
India pushes for expanded banking links with China
....Ambassador to China S. Jaishankar said India had now become the largest market for project exports from China, with over $ 55 billion worth of projects – from infrastructure to power – under execution. “In this background, expanded banking relations between India and China is very important,” he said. “The Reserve Bank of India and the China Banking Regulatory Commission have already reached agreement to expedite processing of licenses... It is only when our banks are more connected that we can be said to have achieved the full spectrum relationship that is natural to neighbours.”..........
Grant Industry Status to Business Correspondents: FINO PayTech Ltd
......According to RBI, "Financial inclusion is the process of ensuring access to appropriate financial products and services needed by vulnerable groups such as weaker sections and low-income groups at an affordable cost in a fair and transparent manner by mainstream institutional players." According to FINO PayTech, BCs as an alternate channel have to be given its own place under the sun. The scale that the BC industry has achieved thus far is of paramount significance and impact both at macro and micro level economics of the rural poor & those at the bottom of the pyramid (BoP).......
Microlenders may move Supreme Court
....“Notwithstanding this recognition of RBI’s primacy as the regulator of NBFC-MFIs by the court, the court has allowed the dual regulation situation to exist in the state,” he said. NBFCs are non-banking finance companies. “One can only hope that the state govt will take constructive note of the signal given by the high court and either repeal the state law or make it applicable only to MFIs which are not under the regulatory umbrella of the RBI,” Prasad said. “We are actively considering moving to the Supreme Court to get redressal.”.........
RBI employees to participate in strike
.....A statement issued by All India Reserve Bank Employees Association and All India Reserve Bank Workers Federation here said that its employees would support the strike and the Central Bank would remain closed.
Nabard staff to join strike
All India Nabard Employees’ Association (AINBEA) will join the two-day strike called by the central trade unions. This was decided at its ninth annual conference held in Hyderabad............
My View on "Two-day trade unions strike to hit life, banking"
For
a change, I would like to do some back of the envelope, reverse
accounting, keeping in mind the estimated loss of 15,000 to 20,000
crore, if the two-day strike really happens. (i) The loss to the
employees joining government and public sector services pursuant to
introduction of New Pension System (ii) The recurring loss to the
workforce in India due to faulty working out of and non-implementation
of minimum wages (iii) The loss to the Indian consumer due to irrational
and one-sided pricing policies (iv) The loss suffered by Indian
citizens availing transport services from airlines, Railways and other
public transport systems (Railways, sometimes, do not even care to
identify the individuals who die while traveling, story of delayed and
denied compensations too is agonizing). Just to remind that GDP is an
aggregation of efforts made by millions of people and occasionally,
those in charge should remember the roots.
- M G WARRIER
- M G WARRIER
Change of Guard, Change of Culture
As
long as DK Mittal was the Secretary, Financial Services, many chairmen
were critical of Mittal because they found him to be hands-on. Now,
after Mittal left, his replacement Rajiv Takru is seen to have a
different approach. In a recent meeting the new Secretary, Financial
Services, Takru made it clear that he will not entertain any banker
below the CMD rank, a wide departure from Mittal’s way of functioning.
Mittal never hesitated to interact with officers who were involved with
the task assigned even if the officer was a DGM rank.
ET
ET
Top jobs at banks, regulators set to fall vacant
.................Come
September, and the Reserve Bank of India too would be in for a change
with D Subbarao, who like Hari Narayan is an IAS officer of the Andhra
Pradesh cadre, due to complete his extended two-year term. It is early
to gauge who will replace Subbarao but it is unlikely that a bureaucrat
will move into the governor’s office on the 18th floor on Mumbai’s Mint
Road..........
Read - TOI
FinMin to appoint 9 new CMDs for PSU banks, 10 shortlisted
.......There was a six-member interview board, which took interviews for CMDs' posts. They were Rajiv Takru, secretary - department of financial services; Anand Sinha, Deputy Governor - RBI, Jagdish Capoor, former Deputy Governor - RBI (1997-2001) and a few other experts including two directors from Indian Institute of Management - Calcutta and IIM- Kozhikode. To step into CMD's shoes, an executive director has to have minimum of two years of service life...........
SBI STAFF DON’T MIND OVERTIME
The
staff at state-run companies don’t have much of a reputation for
performing to their full potential even during normal work hours.But SBI
has managed to work overtime on Monday due to a holiday on Tuesday and a
worker strike on Wednesday and Thursday. The staff had worked extra
hours a day in advance to compensate customers for the strike. Insiders
credit chairman Pratip Chaudhuri who has promised rewards if this
practice is observed. SBI was the only state-owned bank to keep its
domestic branches open for two additional hours — earning the goodwill
of its customers.
ET
ET
HDFC Bank replacing merchant terminals due to 'skimming' fraud
Country's largest credit card issuer HDFC Bank has started replacing some points of sale machines at merchant establishments following card 'skimming' frauds, a top official has said. "We are replacing machines at some merchants," the bank's head for credit card and merchant acquiring, Parag Rao told reporters here last evening. Rao said cases of 'skimming' have been witnessed in the country of late, wherein the card data is copied illegally in an otherwise legitimate transaction, only to be used fraudulently later................
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