Scenarios for Branchless Banking in 2020

 

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Change in default law to shield farmer land

.....The chief minister said the notices were in violation of RBI guidelines. “There is a guideline of the Reserve Bank of India that properties can be confiscated if one fails to repay loans of more than Rs 5 lakh. But in this case, the farmers had taken loans worth Rs 80,000-90,000. We will amend the act,” she said. Banks usually do not demand collateral for priority sector loans below Rs 5 lakh. However, co-operative bank officials said rural co-operative works do not operate under RBI guidelines. Such banks are governed by the West Bengal Co-operative Societies Act, which does not mention a threshold amount below which attachments cannot be carried out, an official said.......

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Private banks way ahead in cooperating with police on security

......Sources with the RBI said that the banks are running a ‘reputation risk' by not fulfilling the required safety features. “We can't insist the banks as they have their own set of guidelines. While private banks are quick to respond, nationalised banks seems to have a lacklustre approached towards essential safety features in branches. We hope rest of the banks would fulfil the requirements before the given date,” a RBI security expert added........

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Saraswat Bank ready for IFRS: Eknath Thakur

The RBI has said that all banks and NBFCS have to improve their skills and use knowledge and technological possibilities to move to the new financial norms so that they could measure up to the challenges of international standards………….

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Need to see Feb IIP data to conclude downturn has ended: Montek Singh Ahluwalia

......"I think CRR cut is good idea because there was tight liquidity. Frankly, it was very widely expected."........... 

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Action plan to cut fiscal deficit needed

..............At present, there is no rule governing the financing of fiscal deficit, particularly on borrowing from the Reserve Bank of India (RBI). The elimination of ad hoc Treasury Bills and discontinuance of participation of RBI in the primary market were epoch-making steps under the borrowing rules...........

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The Budget opportunity

.......Subbarao doesn’t think the time is ripe to touch the repo rate, the rate at which the RBI lends to banks. That may be based more on inflation than market liquidity conditions. Inflation has eased in the food sector but the overall CPI is still above the RBI’s target levels. So, in the monetary policy review on March 15, either the RBI will continue to wait and watch inflation, or could take a small step forward, maybe 25 basis points, on the rate cut cycle..........

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Budget 2012: Budget crucial for RBI & attracting liquidity, says Udayan

……"If the government is unable to fix or even give people the sense that it's on its way to repairing the fiscal situation then it makes a Reserve Bank of India's job very hard,"…….

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RBI attributes economic slowdown mainly to external factors

The Reserve Bank has attributed decline in the economic growth rate to three-year low of 6.9 per cent in 2011-12 largely to deterioration in the external environment……….

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PNB hopeful of SLR cut

……..“I am not very sure what the Reserve Bank of India (RBI) will do about SLR cut, but I hope some intervention from the central bank would be there,” K R Kamath, chairman and managing director of the PNB told media persons here ahead of monetary policy review on March 15…..

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Economy to soon revert to 8-9% growth trajectory: President

....Referring to inflation which has remained a major challenge for the government, Ms Patil said the actions taken by the Reserve Bank of India (RBI) and the government have yielded results and “general inflation has eased”..........

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TIMELINE: Changes to CRR since 1992

Following is a timeline of changes to the CRR since 1992…………

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RBI to keep rate steady ahead of budget: poll

The Reserve Bank of India (RBI) is widely expected to hold interest rates steady at its policy review on Thursday ahead of the budget, a new Reuters poll found, which showed expectations for a start to the rate cut cycle have been pushed back since January………

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2012 to be one of the best years for Indian equities: Centrum Wealth Management

What do you think the Thursday credit policy would entail, would it just be a future trajectory and RBI commentary on how the outlook of rate of interest would be from here onwards and leave it status quo when it comes to any interest rate move?.................

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Budget 2012 could be Pranab’s easiest: he has no options

…..Having boxed itself into a corner, the government has no option but to use Budget 2012 to begin a long-term process of fiscal consolidation, without which – as the RBI has warned – the interest rate cuts that are needed to revive growth stand no reasonable chance. The RBI’s 75 basis point cut in Cash Reserve Ration on Friday effectively puts off any decision on rate cuts until after the budget; that decision will hinge critically on whether the government lays out a credible path towards taming subsidies and generally bringing its deficits under control……

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PF accounts to get lower returns this year

Around 61 million subscribers of the Employees Provident Fund Organisation (EPFO) are likely to get lower returns on their deposits this year. The Union ministry of finance has, for the second time, recommended an interest rate of 8.25 per cent for 2011-12; it was 9.5 per cent for 2010-11…………..

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Vodafone: An Eye Opener for SEBI & RBI

….As if this was not sufficient, the Reserve Bank of India (RBI) started objecting to 'put and call' options in investment agreements and asking strategic investors and the investee companies to apply for compounding, because according to RBI (though not officially communicated) grant of these rights turn equity investment into quasi debt……

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Indian Auditors: Toothless Watchdogs?

.....The violations can result in serious trouble not only with various regulators like the ministry for corporate affairs, RBI and auditing watchdog ICAI, and also bring in contravention of the Indian Penal Code as falsification of accounts and misrepresentation of facts is a criminal offence. This is a classic case of the fence eating the crop. .......

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Financial inclusion – A reality check by the RBI top brass

Pune, March 11: Financial inclusion is something that the banking regulator wants. Top bankers at commercial banks take the cue and set targets for their underlings. Yet, ground level implementation of this agenda remains an unfinished challenge. Enthusiasm for such projects which involve a large part of the local branch manager's time is a problem. Even where customers are a trifle better organised under the aegis of a self-help group, there is not much difference.  Branch managers tend to adopt delaying tactics while opening ‘no frills' savings accounts, knowing that they don't contribute much to their deposits/advances or bottomline immediately. Even when branch managers are well-meaning and sincere, there are other issues. For instance, the processing of papers involving ‘know your customer' norms involves delay. And often that happens for as simple a reason as photos of customers not getting affixed. Why? Because villages have no photographers in the immediate vicinity! Sometimes, when banks do have the requisite infrastructure, there is a servicing issue. It takes a couple of weeks to get spare parts/ replacements of essential items in rural branches. Some times the servicing vendor doesn't have the wherewithal to discover immediately where the problem is – whether it is with the machines or it is with satellite connectivity. Sometimes there are technical issues such as the fingerprint scanner not being able to decipher the prints of older persons. These and a number of similar problems came up at a frontline managers' conference on financial inclusion at Pune last Friday. It was a reality check for the RBI Governor, Dr D.Subbarao, and his top team who listened to customers, self-help groups and branch managers voice their problems. The Governor wondered whether banks considered ‘no frills' accounts a nuisance and closely questioned individual branch managers about this. Urging them to speak frankly, he added, “We didn't invite chairmen and managing directors of your banks, so that you can speak frankly.” At the end of it, one asked Dr K.C.Chakraborty, Deputy Governor, RBI, whether he was surprised by anything he had heard. Conceding that a lot of it was familiar ground, he said banks need to find innovative solutions. If they don't, they will have to fight with other banks that do. “I have been saying we need 200 more banks,” he said.

HBL

MFIs revival: Responsible lending is key

Regulations need to be changed to facilitate provision of financial services to the poor and the overall architecture of financial services should be rebuilt, experts

.... The Malegam committee report largely says RBI does not have the machinery to control this growth and therefore this growth should be curbed. RBI is neither going to facilitate the growth and nor it is willing to find a solution to the problem of consumer protection......

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MFI body seeks clarity over regulations in Budget

........ According to MFIN, the problem is while the Andhra Pradesh legislation directs MFIs to get registration from state authorities, RBI regulations provide for registration from the central bank. The AP MFI Act says that no MFIs will grant any loans or recover any loans without obtaining registration under this Act from the registering authority, whereas the RBI Regulation says MFI is an NBFC and under the RBI Act 1934 an NBFC can do its business without any further permissions or registrations, according to MFIN........

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XLRI Jamshedpur to create a common research & action network for micro finance practitioners

..... The Reserve Bank of India has made efforts to increase the penetration of formal financial services in unbanked areas, while pushing its policy of ensuring adequate and viable credit flow to priority sectors of the economy………

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Dark age of Indian telephony

Governor Subbarao talked of the rapid changes in the Indian economy at a National Institute of Bank Management (NIBM) convocation. He talked of the telecom revolution, and contrasted the situation that prevails today with what happened when he was a young sub-collector at Srikakulam District, Andhra Pradesh. Referring to that early period in a humorous manner as the ‘dark ages', he talked of how he would try to contact his boss, the collector, who lived just 35 miles or so away. But it would seem very far away because the only means of contact was through a ‘trunk call' — which would never come through. And it had to be done through a telephone instrument which didn't have direct dialling facilities. One had to go through an operator at the exchange, and depend on both the operator's whims and luck to get a call through. With a twinkle, the governor said, “There was no way you could even call a girl friend with that kind of system,” evoking roars from the assembled audience.

HBL

Risky vacant seats

RBI Governor, Dr Subbarao, describes himself as a shy, withdrawn and self-contained person. He prefers to keep to himself — especially on flights, and therefore requests a vacant seat next to him on such flights. But he has found that has its own downsides. Any one who thinks he can get the governor's ear for a few minutes ends up plonking on the vacant seat, and so the poor governor is forced to make conversation. Now, he prefers to have the next seat occupied and limit the damage. That's risk management for you.

HBL

Grit meets grace

..............way from the line of duty, of files and GOs (Government Order) Anna bided time to finally marry her colleague and sweetheart, R. N. Malhotra who became the RBI governor in 1985. “It was worth waiting for,” she says with fondness about a man in whom she found “exceptional humane qualities”. In distant Washington, where he was serving, they had a simple wedding but not during ‘rahukalam' as her orthodox mother would have been very upset! ......................

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Inter- play of monetary & fiscal policies – S.S.Tarapore

In the early 1970s, the then Governor of the Reserve Bank of India ( RBI), the late L K Jha, pithily summed up the inter- play between monetary and fiscal policies. He said that the government jams the accelerator and the RBI's job is to slam the brakes as hard as it can..................

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Deficient service: ICICI, Corp Bank fined

 A Delhi consumer forum has imposed a fine of Rs 15,000 on Corporation Bank for misplacing an account payee cheque worth Rs 45,220 of ICICI Bank, which was found to have cleared it as bearer cheque to a wrong person despite several changes made on it.................

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Industrial and Commercial Bank of China hits language wall

...... The bank has requested the Reserve Bank of India to allow more Chinese expatriates to be employed in its lone branch in India's financial centre, citing inability of the local hires to communicate with the headquarter. The RBI has now forwarded to the government seeking approval due to security concerns. "In most such cases we do provide limited exemptions but since this involves the Chinese, given the sensitivity, we have consulted the government," said an official with RBI, requesting anonymity.......

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Coop banks look at FM for tax deductions in Budget

..... "Taxing the cooperative banks proves as a deterrent for the growth of cooperative banking structure and the objective of financial inclusion. Hence, our primary demand is to restore income tax deduction for all the cooperative banks,".....

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Banks must collaborate, not compete

Reaching out to the poorest of the poor is no longer a social obligation but a very viable business venture

Collaboration and not competition could help achieve financial inclusion in India. Collaboration among banks and between banks and technology firms and mobile service providers is imperative as the task is huge..................

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SB interest rates

The news item “Public sector banks in no mood to hike savings account rates” (Business Line, March 7) confirms that banks aren't sensitive to genuine issues relating to savers. The way they deal with small farmers and businessmen points to that. The reasons given for not hiking rates for savings bank accounts — such as non-migration, savings bank rate is a basic rate, likely distortion in rate structure, possibility of charges for services — are unconvincing. Market-based rate of interest can attract large savings from low-income households. Banks should be advised by the RBI to review their stand, so that savings bank account holders get real interest rates, and the system gets increased financial savings.

- Subramania Thiagarajan (HBL)

RBI waits for FM

Monetary policy is most effective when it is unanticipated, and the Reserve Bank of India’s (RBI’s) decision to cut the cash reserve ratio, or CRR, for banks by 75 basis points on Friday was indeed unexpected. This is a pleasant change, for the central bank has in recent times chosen to focus on its regular schedule of reviews instead of responding to the needs of the market more spontaneously. This cut was welcome not just for its well-planned timing, but also for its relative size; the RBI has, too often, moved with baby steps when strides are called for. Now, by cutting CRR by 75 basis points to 4.75 per cent, Mint Road has acknowledged that there is something very wrong with the degree of liquidity in the system.........

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Treating the symptom

..... The RBI's OMOs and CRR reductions only address a symptom (‘tight liquidity conditions') rather than the real disease of a deepening slowdown. The right way to treat that is through aggressive interest rate cuts, which is what the monetary policy doctor ought to be doing today. One hopes the Governor, Dr D. Subbarao, initiates it at the central bank's next mid-quarter monetary policy review on March 15.

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'Good customer service key to banks growth'

.........."With enhanced competition amongst banks, customer service becomes the soul differentiating factor to be leveraged to stay relevant and to forge ahead in the business,"............

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‘The primary task in the Budget is to restore confidence in govt’

Dr Bimal Jalan, former RBI governor and author of the forthcoming book Emerging India: Politics, Economic and Reforms, talks to Olga Tellis about mis-governance on the eve of the Union Budget. Dr Jalan says that the heart of the problem is the waste of public resources because of corruption and diversion of resources............

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Yawning gaps in access to financial resources

.....................The authors could also scale up the business correspondent model of the RBI, self-help groups and micro-finance institutions. While associated problems with these institutions are hot topics of discussion at present, one feels the authors could have drawn suggestions from international experience.

Overall, it is a book for hard-core economists, bankers and researchers. The others would need to do plenty of skimming to keep going till the end.

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A ‘refill' exercise

.........The CRR cut is expected to release around Rs.48,000 crore into the system. In the end, the cut in CRR is more in the nature of a ‘refill' exercise. And, the liquidity position in the bank “will remain as it were prior to the latest CRR cut.” The coincidence of the CRR cut, which comes immediately after a meeting between the RBI Governor and the Finance Minister and a few days ahead of the mid-quarter review of the monetary policy, is not lost on the discerning observers of the economy.......

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CRR cut : What prompted RBI to act ?

Monetary Policy is formulated and announced by the Central Bank of a country. This policy aims at influencing interest rates and money supply in the economy. Reserve Bank of India ( RBI) is scheduled to announce its monetary policy on March 15th. However in a sudden move unanticipated by many, RBI cut CRR on 9th March six days before its monetary policy. An analysis of this move reveals some interesting insights. This article seeks to simplify the CRR cut & present an analysis of the future trends in interest rates in a logical manner........

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RBI signals a downward bias in interest rate cycle: S Raman, CMD of Canara Bank

A day after the Reserve Bank of India cut the cash reserve ratio for banks by 75 basis points, S Raman, CMD of Canara Bank, said the central bank has reinforced downward trend of interest rates. In an interview to ET, Raman said banks would not prefer to cut lending and deposit rates before March-end, unless the upcoming RBI policy announces a reduction in policy rates. Excerpts:.......

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RBI policy rate cuts to depend on inflation scene: C Rangarajan

..... "I think that (policy rate cut) will depend very much upon how inflation behaves. But this present decision of cutting CRR by 75 basis points is an important step towards easing of the monetary policy,".......

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A CRR cut in time saves big for banks

..... "The CRR cut was more to manage liquidity. But on interest rates, banks may cut rates in select products. But I don't expect banks to cut base rates immediately. Bankers would like to read the tone of RBI's policy on March 15 and a likely policy rate cut in April, before taking major rate action,".........

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Mobile wallets to be opened to 100% FDI

..... The Reserve Bank of India has already given its conditional nod to the finance ministry's proposal to allow 100% foreign direct investment (FDI) through the automatic route in these payment services, but experts say the conditions are cumbersome.......

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Finance Ministry looking at merging RRBs with sponsor banks

....... The number of RRBs has shrunk from 196 in the early 2000s to 82 now on account of restructuring and amalgamation of RRBs to improve their financial soundness. According to RBI figures, as of March-end 2011, the 82 RRBs collectively had deposits of Rs 1,66,232 crore (Rs 1,45,035 crore as of March-end 2010) and advances of Rs 94,715 crore (Rs 79,157 crore).

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Traffic survey ordered for metro project

Ahmedabad........ A surveyor who was roped in for the survey said the survey is being taken up at specific locations which includes Vasna, Paldi, Ellisbridge, Nehru Bridge, Old RBI office, Income Tax, Gujarat Vidyapith, Vadaj, RTO and Sabarmati in Ahmedabad city. Also survey is being ordered on similar lines in Gandhinagar city....... Read...........

Online banking security up a notch

Now you can do online banking at a shared terminal with peace of mind

..... Now, with the RBI mandating a very high level of security in case of online transactions, banks have been scrambling to find solutions........

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Industry ministry in talks to start e-biz model

The Industry ministry will hold consultations with the representatives of the Controller General of Accounts (CGA) and Reserve Bank of India (RBI) to work out a payment mechanism to operationalise the e-biz project that seeks to improve business climate in the country..........

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Indian Rupee Shortage

As per recent media reports, the private sector has been concerned about the shortage in the Indian rupee component of the national foreign exchange reserves. The government hereby clarifies that, while there have been shortages in the Indian rupee component, the overall foreign exchange reserve is well within the threshold levels. Currently, as per the RMA, the foreign exchange reserve situation is US dollars 691.76 million. That is equivalent to 13.5 months of imports, which is favourable, compared to not less than 6 months in other countries...........

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D Subbarao, C Rangarajan, Kamath amongst Top Leaders to address Convocation 2012 at IIMs

.....While Dr. D Subbarao, Governor, RBI will grace the convocation at IIM Bangalore to be held on March 30, K V Kamath will be the chief guest at both IIM Ahmedabad and IIM Indore to be held on March 24 and March 31 respectively. Dr C Rangarajan, will be the chief guest at IIM Lucknow Convocation on March 17............

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Mr Subbarao, why not double the joy with a repo cut next week?

..... The question now is will the central bank cut repo rates in its 15 March policy review or will it do so in its annual policy review in April 2012? The difference between March and April in terms of data points will not be much as March inflation is expected at around 6.5-7 percent levels, and this inflation number will be released in April. However, the difference a repo rate cut in March will make to money market sentiments will be high........

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First sign RBI’s shifting to growth mode

..... Friday’s cut infuses Rs 48,000 crore into the banking system, effective March 10, which is the beginning of the fresh reporting fortnight. The effect of this will initially be felt more in equities than bonds.....

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Subbu Sab jaanta hai, part 2: Why RBI Gov did what he did

……..Subbarao knows that he cannot relax his vigil on inflation. The pyrotechnics on CRR are intended to make up for slowing down on repo rate cuts. So forget about a 50 basis points cut in repo on 15 March. Be happy if he even does 25 bps – just to keep the FM happy. And don’t count on too many more cuts to follow. Subbu is no wimp on inflation.…….

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Bankers rule out cut in lending rates following reduction in CRR

Bankers on Saturday said RBI's more-than expected 0.75-percentage point cut in cash reserve ratio (CRR) will ease the liquidity strain, but ruled out any immediate reduction in lending rates. "We were expecting 50 basis points cut in the CRR and hence, are pleasantly surprised by the Reserve Bank's move... banks will not cut lending rates immediately though," SBI Chairman Pratip Chaudhuri said.......

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Pranab urges private, foreign banks to improve customer services

....The Union Finance Minister, Mr Pranab Mukherjee, on Saturday urged private and foreign banks to put in extra efforts to improve their customer services and redress their complaints......

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Performance of Co-operative Urban Banks reviewed

To review the performance of Urban Co-operative Banks functioning in the State of Jammu and Kashmir and discuss latest policy developments a meeting of the State Level Task Force on Co-operative Urban Banks (TAFCUB) was held at RBI Jammu under the Chairmanship of KK Saraf, Regional Director for Jammu and Kashmir. Ghulam Rasool Khan, Special Secy. Co-operative Department Jammu and Kashmir alongwith Riyaz Ahmad, Jt. Registrar (B&F), Co-operative Societies, Jammu and Kashmir attended the meeting. Ashok Goswamy, CEO, Citizens' Co-operative Bank Limited, Jammu, RD Gupta, CEO, Devika Urban Cooperative Bank Limited, Udhampur, MA Sofal, CEO, Urban Co-operative Bank Limited, Anantnag and AM Dar, CEO, Kashmir Mercantile Cooperative Bank Limited Sopore were also present in the meeting.

http://www.greaterjammu.com/2012/20120303/business.html

A gap-up opening on the cards

The Reserve Bank of India's (RBI’s) surprise CRR (cash reserve ratio) cut is enough a reason to bring cheers to the market on Monday morning. However, going ahead, it seems unlikely the up move will be sustainable during the week.........

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How long is late before a cheque is credited?

You drop a cheque with your banker for collection. How long will you wait before it is credited to your account? A week? 15 days? A month? A customer had to wait for 10 years! The case of this customer, call him Mr Dixit, is recounted in the 2010-11 Annual Report of the Banking Ombudsman released recently.........

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Boring banks theory does not work anymore: Subbarao

…. “So the question is, is making banking boring necessary and is it sufficient to prevent the recurrence of financial instability? If so then what is the cost of making banking boring?”….

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‘Company secys should be aware of new laws’

MYSORE: The company secretaries of those firms which have significant trade transactions globally must be aware of the new laws and regulations, said Uma Shankar, Regional Director, Reserve Bank of India, Bangalore, on Thursday.  Uma Shankar was speaking at the workshop on foreign exchange organized by the Institute of Company Secretaries of India-Mysore chapter in association with the Foreign Exchange Department, Reserve Bank of India, Bangalore.  Uma Shankar touched upon the transition from FERA to FEMA. She said liberalization under the remittance facility scheme also enjoin upon all those making use of foreign exchange responsible and accountable to the regulators and policy makers.  M Palanisamy, Banking Ombudsman for Karnataka, said the Banking Ombudsman scheme was introduced by RBI in 1995 to provide inexpensive and expeditious resolution against complaints relating to deficiency in the services provided by banks. There are 24 grounds on which complaints can be preferred with the office of Banking Ombudsman.  These include deposit accounts, loan products, pension payments, ATM/credit cards, levy of charges etc., Palanisamy added.  Apart ftom nearly 100 company secretaries from various cities of south India, chartered accountants, industry representatives and students attended the programme.

HT

Kulavaipatty declared as model village for financial inclusion

Reserve Bank of India declared Kulavaipatty near here as a ‘model village for financial inclusion' among the rural pockets selected by it under its outreach activities. A function was organised at the village on Friday when a number of officials from banking industry and district administration felicitated the villagers for their cooperation to the efforts taken by the RBI for the past several months. N.S.Vishwanathan, Regional Director, Reserve Bank of India, Tamil Nadu and Puducherry, said that the RBI had identified a few villages as either ‘unbanked' or ‘under-banked' areas under the ‘Outreach Activities'............

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Banks may tap informers to track defaulters

....Law enforcement agencies resort to them. The tax authorities find them useful. Now, banks too are looking at them. ‘They' are informers, and the Reserve Bank of India has sought the Indian Banks' Association's views on whether banks can tap such sources about the assets owned by defaulting borrowers and offer rewards for the information......

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Bank customers tortured by recovery agents; ombudsman helps out

......The apex bank had laid guidelines to be adhered by the banks’ recovery agents. However, experts point out the need for recruiting trained recovery agents. “Banks should engage trained agents to recover the money, as it is important to deal with debtors with ‘humaneness’,” GS Hegde, RBI’s principal legal adviser, was quoted saying by PTI.

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Expert views on RBI`s CRR cut

"This is a surprising move but it's definitely a step in the right direction. This will ensure that liquidity situation improves in the market and smooth credit flows to priority sectors. The move brings us closer to a cut in the interest rates."..................

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‘Financial inclusion programme not making much headway’

 

RBI Governor D Subbarao rules out SLR cut

Pune : "SLR cannot be reduced at the moment because there are a number of pre-conditions to such a decision which cannot be met," he said, addressing a convocation at National Institute of Bank Management (NIBM) here................

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CRR cut will ease liquidity, say bankers

The cut in Cash Reserve Ratio by the Reserve Bank of India will go a long way in easing the liquidity deficit in the banking system, said bankers. The move will inject around Rs 48,000 crore into the system.................

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Subbarao’s surprise CRR cut puts ball in Pranab’s court

...... Inflation, after all, still remains the RBI’s biggest enemy, and he has attempted to oil the slowing growth engine a bit by infusing fresh liquidity (the CRR cut is effective 10 March). Some, however, are betting on a 25 basis points cut in the repo rate soon. This is a bold RBI governor. And he has the ability to surprise either way. And as of now, he holds all the aces.

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RBI cuts CRR: Developers hail cut; hope banks to fund realty projects

.... "This is a positive step by the RBI. This will help financial institutions to lend money to entrepreneurs for the growth of business as well as the economy,".....

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RBI cuts cash reserve ratio by 0.75%, demand for money rises

 ..... Two weeks ago, RBI deputy governor Subir Gokarn hinted at an action.  Here are pointers that could help explain the reaction: .....

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Rate cut on the cards

..... the only way to raise savings is to lower the public sector deficit, since it is the rising public sector deficit that has led to lowered savings rate in the country over the past few years. Even so, Thursday’s CRR cut is a positive boost to sentiments and raises hopes of the Budget being more pro-reform than most believe.

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RBI's CRR cut a proactive step, but policy rate cuts still weeks away

.....Off late, RBI Governor Duvvuri Subbarao has been vocal about the limitations that monetary policy tools in an economy which runs higher twin deficits on both fiscal and current accounts. So, the tight rope walk of RBI continues. The Budget, scheduled for March 16, will be something that Subbarao will take his next cues from.

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RBI delivers, can lame duck govt?

....While the RBI has done all it can for now, can the Union government reciprocate by cutting expenditure in the Union Budget next Friday, and allow the central bank to cut interest rates too, especially since the debacle at the hustings in Uttar Pradesh and other states? .....

Story

Industry seeks more cuts in CRR

….The Associated Chambers of Commerce and Industry of India (Assocham) sought another CRR cut, one of 100 basis points, before the monetary policy review next week, saying policy rates should also be slashed in the review on Thursday to stimulate fresh investment…..

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RBI cuts CRR: Will March 15 credit policy be a non-event?

........ The RBI is scheduled to announce the mid-quarterly review of its monetary policy on March 15, a day before the presentation of the Union Budget 2012 in Parliament. So, now what happens on March 15? Will it be a non-event?.........

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First sign RBI’s shifting to growth mode

....The surprise 75 basis points (bps) cut in the cash reserve ratio (CRR) by the Reserve Bank of India (RBI) on Friday is more than a liquidity-easing move. The Street was expecting a 50 bps cut in the monetary policy review on March 15 and the fact that the RBI cut more can be taken as the central bank indicating a complete shift in its monetary stance. Tight liquidity conditions have provided an opportunity for it to indicate the shift from controlling inflation to spurring growth......

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IIM Rohtak completes its first-ever final placements process

.... The companies that participated in the final placements include HSBC, Pfizer, Tata Motors, BPCL, HDFC, Tata Steel, Cognizant, Mother Dairy, Yes Bank, Tata Power, Max New York Life Insurance, Berger Paints, RBI, Titan and Ernst & Young among others……

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TimesOfMoney Plans Domestic Mobile Remittance Service

............ At the moment, domestic remittance services are mostly offered through banking correspondent tie-ups, since the RBI has enforced strict guidelines and require KYC (know your customer) documentation. Although the central bank had proposed relaxations in the guidelines, and had removed the Rs 50,000 cap on mobile transfers, mobile money hasn’t really picked up in India…………….

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Polaris’ Intellect Wins XCelent Customer baxse Award for Asia-Pacific Region

.......Leading in the Asia-Pacific region, Polaris outsold other vendors with its Intellect solution, based on its RBI deal. Polaris' major deals were a major part of the deal scores, with the RBI win helping Polaris score strongly in the ranking index........

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No elbow room to provide stimulus - S.S.Tarapore

.......Loss of monetary control and a weak fiscal resolution would imply a resurgence of inflation. Forty years ago, the then Governor, S. Jagannathan, speaking at the Bankers' Club in Chennai, said “while planning their resource position, banks should not count upon recourse to the Reserve Bank as an easily available resource”. Today, bank accommodation from the RBI has become a chronic addiction. If not treated early, this would eventually require a cold turkey approach, which would be disruptive to the financial system.

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Good economics is good politics

.... The forthcoming Budget comes at a critical juncture for the economy. Growth has slowed down perceptibly. Investors' sentiment is at its weakest since 2004. The global economic situation is fragile. This will hurt our external demand prospects at a time when the current account deficit threatens to cross the dangerous mark of 3 per cent of GDP. Interest rates remain high and the RBI does not seem to be in the mood to relent as long as inflationary pressures remain, fuelled primarily by a profligate fiscal policy and supply side constraints that are becoming entrenched as investment in new capacities is simply not forthcoming. Therefore, the first and most important task for the coming Budget must be to work with monetary policy to eliminate inflationary pressures, thereby allowing interest rates to come down......  

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Till debt do us part

.......As of today, the government sets a borrowing target that it then asks RBI to fill in. An independent DMO will not have the backstop of a monetary authority and will therefore find it necessary to engage with the government to moderate its borrowing. This will act as a hard budget constraint providing the fiscal discipline, which the government sorely needs........

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RBI can’t control WPI

...... In the case of agriculture, where inflation has been the highest, government policy of spending on subsidies instead of investment has ensured productivity has hardly risen. In other words, while RBI can at best affect outcomes marginally, and that too after the event, all the real levers lie with the government........

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RBI Salaries and Perks

This is a video describing the prevailing RBI Salaries and Perks for Entry level officers i.e. Grade B and Grade A. This video is compiled from RBI notices. Complete article @ http://gurpreetseehra.hubpages.com/hub/RBI-SALARIES-BENEFITS

Should We Believe CEOs Who Say NPAs are Not Alarming

… But the matter of real concern is that most of banks are facing liquidity crisis , borrowing money in lacs of crores from RBI and where scope of lending is very much reduced due to inaction of government on needs of corporate sector , it is unavoidable that in near future quantum of bad assets will grow at faster rate whereas lending at lower rate which will result in rise in Gross NPA to total Advances Ratio.....

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Aadhaar card has little relevance while investing, buying policies.......

“Not all banking services can be provided on the basis of Aadhaar though RBI has agreed to it. As of now, we are allowing only no-frills services on it and that, too, to those who cannot provide any other valid document.” Agrees a foreign banker, adding more clarity is required........
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Raw deal for depositors

I refer to the news item "Public sector banks in no mood to hike savings account rates” (Business Line, March 7). Bankers are only taking undue advantage of the multitude of Savings Bank depositors who have no one to represent them. Be it retail shareholders or retail depositors, they are always left in the lurch. India has a lot of personal savings, but isn't getting the desired attention. I recall the remarks of M. R. Pai, ex-president of All India Depositors Association, who said, “The greatest asset in a bank's balance sheet is the ignorance of depositors.” Banks are keen to keep their Net Interest Margin 3 per cent plus. They won't look at retail borrowers or retail depositors, but lend large amounts to corporates at base rates, and write off large amounts. If credit sanctions and monitoring of large values are done with due diligence, it will give room to take care of retailers — both borrowers and depositors.

- L. Rangarajan (HBL

Banks increasing service charges

.... Early last year, when the Reserve Bank of India (RBI) raised the savings bank rate to four per cent, bankers had made it clear they would raise service charges to help make up for the high rates. Then, came the savings rate deregulation in October 2011. Now, if a bank is free to fix the interest rates it wants to pay you on savings deposits, it is also free to decide on charges to adjust the pinch on its pocket.......

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India ‘needs sustained effort to check deficit'

.......India's fiscal deficit exceeded the full-year target in the ten months through January, adding pressure for steps to restrain the gap in next week's budget. The Reserve Bank of India has signalled that efforts to curb the shortfall will boost its scope to cut interest rates as economic growth slows..........

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Fiscal consolidation will be in focus

.......Further, with the RBI clearly signalling the need for concrete steps towards fiscal consolidation before embarking on the path of monetary easing, plausible measures from the central government in this regard would be keenly watched out for.......

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Financial Inclusion - Drive to Diverse Business Models

.... Despite augmented thrust by the government and RBI on Branch expansion since 1969 i.e. Banks Nationalization, still the fruits of the banking not reached to substantial population, especially the underprivileged sections of the society,…..

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Karnataka Bank to open 20 financial inclusion branches

......Financial inclusion branches will be opened in the villages, where the population is above 2,000. The branch will take care of the entire requirement of the village such as credit disbursement and opening of accounts.........

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Tips for facing bank clerical post interviews

.... “Candidates these days are even trained on how to enter the room, how to greet, how to sit and how to say bye at the end of interview. Very few candidates are frank and speak from the heart. They give the standard, well-rehearsed answers.” ........

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Govt panel moots more powers, sops to asset reconstruction cos

.....The panel, headed by Alok Nigam, has recommended that the Reserve Bank of India (RBI) should empower ARCs to convert debt acquired by them in usual course of business from banks and FIs into equity of the defaulting company by way of a new contract........

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Those glittering assets

..... Clearly, the government and the Reserve Bank of India (RBI) need to focus intensely on how to bring at least part of these glittering assets into more productive use. The RBI should enable a liquid paper gold market, through instruments like gold savings accounts (GSAs), gold deposits and gold securities, so that investors could continue to maintain gold savings but without needing to hold all of them in terms of physical bullion.......

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Administration needs 2 more months to start work

 ….. The authority has proposed four multi-level parking lots at each corner of the sector, away from the plaza, where vehicles can be parked, but only one of the four, near RBI building, has been planned so far…….

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Near victory for Indians abroad for filing online RTI applications

After several years of persistent campaign by RTI activist Commodore Lokesh Batra and several RTI activists abroad, the RBI, early this week, has given a “no objection” to the government for the sale of electronic postal orders through credit/debit cards for paying RTI fees. Now the Department of Posts has to quickly find a technology solution...........

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Rare coins see rise in popularity, value

........ Indian coins exported before independence are sold in foreign markets, according to Todywalla, and they tend to raise more money than those sold at home because of their rarity value. But increasingly, Indian coins are finding their way home to collectors from the country.......

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Workshop on foreign exchange

The Mysore chapter of the Institute of Company Secretaries of India has organised a workshop on foreign exchange in association with RBI, Bangalore regional office, on its premises at 125, NHCSL Layout, KRS Road here on Thursday at 10 a.m. RBI Bangalore Regional Director Uma Shankar will be the chief guest and Banking Ombudsman M. Palaniswamy will be the guest of honour at the event. There will be an awareness exhibition on foreign exchange, coin vending machines and so on at the venue on Thursday and Friday from 10 a.m. to 5.30 p.m.

HBL

Bank unions demand 5-day work-week

Bank employee unions have demanded the government to grant them a five-day work-week. A senior official of the Indian Banks’ Association (IBA) lamented that their persistent efforts to get the government to introduce five-day week have not borne fruit yet. “We wish them (other unions) luck.” Government-owned banks are in favour of five-day week. “None of the financial markets works over the weekend and even state and central government employees work five-day weeks. It’s only fair for banks to demand this,” says a senior official at a public sector bank.

DNA

May their souls rest in peace.........

Shri.D.S.Banavali died in Andheri Mumbai on February 6, 2012. He was 85 years old. He had worked as P.S to Deputy Governor Shri. Ramakrishnayya

Shri.K.K.Singh died on February 24, 2012 in Andheri, Mumbai He was Economic Assistant in the Library of the Economic Department. He was 88 years old.

- As reported by P.P.Ramachandran (via e-mail)

Down with memories............

I felt very sad on coming to know that Mr Newlay is no more. Had I known on that day I would have attended his last day. I knew him very well even when he joined RBI Chennai as a Probationary Officer in Gr A. I was working as Cl Gr II at that time. On one occasion when some employees played mischief with him, he could have easily complained against them to the Manager but instead he said to me, "Every action has an equal and opposite reaction". I did not know why he chose me to say this. May be he hoped I would counsel others not to be harsh in their attitude towards him. I had interacted with him on several occasions while in service. He used to tell me how he changed the atmosphere in CAB. Later, after retirement, we used to meet very regularly in Pune. We even had dinner at my house on occasion and again tea at his house on another. CAB invites senior retired officers whenever dignitaries visit CAB and also for dinners on many occasions. We always chose to sit together and chat. He used to talk to me very fondly. On every occasion when he came to CAB, I saw almost all employees coming and wishing him with reverence. Very soft spoken and affectionate friend to everyone. He was even present on 1st Nov last year when CAB invited all retirees for a get together and lunch. Though he was looking week, he was cheerful. As usual we sat together and chatted. I miss a good friend. I miss him terribly. May his soul rest in peace.

- P.Aravind

I worked with Mr.Newlay at the staff college--one of the finest gentlemen. His death is somewhat untimely.

- K.Kanagasabapathy

Shri Newley’s  was a warm and affectionate personality and he used to greet his colleagues with his characteristic smile and cheering words. He was open to suggestions and played his role in liberalising perks/facilities for RBI-ites when he was a JCO in PPD. He was happy that we were bringing out a book as part of the Platinum Jubilee celebrations (Mint Road Milestones: RBI At 75) and extended his best wishes and support to our team when we had met him last at CAB.

- Surendra Khot

I am shocked to know about the demise of our friend guru and a fine human being.

- P.Shyam Sunder (Shillong)