Card PINch

My View on  "Now, a cover for card PIN-based frauds at retail o...": 

This looks very much as an advertisement but for the non-disclosure of names of insurance companies. This is another window open for your card data to get in. Every insurance product is based on risk pricing. Those cards that would have occasion to go for the cover when the fraud on card occurred, would have to cough up higher premium in the following year. After introducing this measure, the POS started asking the customer for the PIN. Never disclose even if either of you is in hurry. Second, when you enter PIN it is not unlikely that the person next in key would be closely watching your nimble fingers; be watchful of your valet before coming out of the cue and the shop. Security at the POS for the card machine is very poor. 

- Yerram Raju

Card transactions with Aadhaar validation need more time: experts

...........Although all transactions through debit cards are now required to be authenticated by PIN, validating financial transactions by using the biometric Aadhaar identity number database is yet to gain traction. Such a service is expected to begin in May. Not all experts are in favour of the central bank’s move to use biometrics data to authenticate transactions.......

Read - Mint

3 cos vie for Axis Bank’s swipe biz

..... Top three private banks account for 75% of the installed swipe machines or electronic point of sale (POS) terminals as they are known in the payment industry. ICICI Bank has the largest network of 2.57 lakh swipe machines followed by HDFC Bank with 2.4 lakh.  Axis Bank, the country’s third largest private lender, also ranks number three in POS terminals with 2.27 lakh machines. These terminals facilitate cashless shopping transactions by swiping credit or debit cards, helping merchants to reduce risks and costs in handling cash. Domestic card payments are reporting explosive growth with the Reserve Bank of India (RBI) asking banks to issue debit cards to all account holders and increase their network of merchants accepting the cards..........

Read - TOI

60 villages in Tirupur have no ATMs

......Seeing the critical gaps in the ATM penetration, the District Consultative Committee for Banking Development is now making requisitions to various bank branches in the rural areas in the 60 villages to install ATMs as quickly as possible.......

Read - The Hindu

We want to drive higher cash efficiency in the country: Rajiv Kaul

....RBI prints money and gives it to banks. Banks have currency chests in many cities. This money then goes to bank branches and ATMs. This is where the cash management company comes. After the consumers take the money out, they spend it and it eventually flows back to banks and then to RBI. The whole cycle is not only about the movement, which is a big part of it, but also processing. You check the currency notes for counterfeits, dirty torn notes, you reconcile balances for the customers and for these banks—a lot of software comes into play there............

Read - Mint

Banks as insurance brokers? Yes, no, maybe

.......The RBI draft has also outlined a remuneration structure so that banks don’t have much incentive to hard sell products. According to the draft, the staff engaged in insurance broking services will not be paid any incentive, in cash or kind that is linked to the income received from the broking business. The staff is also not permitted to receive any incentive directly from the insurer. “The idea here is to ensure that the banking business does not suffer at the hands of third-party income. Eventually,........

Read - Mint

Axis Bank employees forged signature of its account holder

......Ms Sanghvi again went to ombudsman on 14^th October to receive the order and the ombudsman officer (Bijani) said that, “If they cannot locate an ex-employee (Namita) for five months and not do anything about it, that means the bank is involved in it and they are blaming someone who has left the organisation.” Ms Singhvi has since approached the Department of Banking Operations  & Development (DBOD) on 28 November 2013. The person-in-charge there Mohindar had asked her to wait for an answer from the Axis Bank. She has also received a reply from the RBI that “This case is not under the purview of RBI since she received the money from the ombudsman and also because she has done a police complaint.” .........

Read - Moneylife

New platform for OTC forex and interest rate derivatives from Dec 30

The Reserve Bank of India (RBI) said on Wednesday that market participants will have to report trades for Over-The-Counter (OTC) foreign exchange and interest rate derivatives to a new platform developed by Clearing Corporation of India Limited (CCIL) from December 30.............

Read | Business Standard

Early news is good news

....... In fact, the publication date was brought forward by almost a month, compared to the previous occasion, when it was merely a day earlier. Of course, amending schedules to soothe markets also has a flip side. If RBI does not publish the next quarter's data on March 2 or earlier, the markets may very well take this as a sign of bad news and react accordingly. This raises the larger question about the capacity of the system to release this data with less than a quarter's lag. If the capacity existed, why was this practice not begun earlier?.........

Read | Business Standard

DYK: The components of WPI and CPI differ

......There are some common components in both baskets—such as fuel and food articles—but here as well, the CPI focuses mainly on end consumption linked articles whereas the WPI as a mix of both. If you look at the end .........

Read - Mint

Foreign bankers line up to meet Rajan after subsidiary promise

Top executives of foreign banks are making a beeline for appointments with Reserve Bank of India (RBI) Governor Raghuram Rajan. The agenda, among other things, is to discuss the subsidiarisation of foreign banks in India, say people familiar with the development. Following the central bank announcing the final norms on wholly-owned subsidiaries (WOS) of foreign banks last month, the reciprocity clause in the norms is seen as a barrier to allowing foreign lenders unfettered branch access. This is because...............

Read | Business Standard

Inflation-indexed imperfections

..........In May, the Reserve Bank of India (RBI) introduced inflation-indexed bonds - which was quite inexplicable, given the stated purpose such bonds were supposed to serve. Nothing could be further removed from instruments that were simple and easy for ordinary people to buy, hold and sell when necessary. The bonds were no different from regular government securities, which are the stock-in-trade of professional wholesale money market players. True, a portion of the offerings was reserved for individual investors. All that they needed to do to lay their hands on them was to open an account with a primary dealer and get the bonds at the cut-off price!.........

Read | Business Standard

Strategists boost rupee forecast on Raghuram Rajan policy

Strategists raised their end-2013 forecasts for India’s rupee by the most in seven quarters as the current-account deficit shrank and central bank governor Raghuram Rajan acted to rein in inflation. The currency will end December at 62.50 per dollar, according to the median of 46 estimates in........

Read - Mint

Need for a weak rupee policy

........The central bank should forget the political argument for a strong rupee and focus instead on building export competitiveness and macroeconomic stability. There is no case for a capital flow-led currency appreciation. But there is a clear need to take an “official weak rupee policy”. This will help the corporate sector avoid misadventures of the boom years when huge monies were raised from foreign currency convertible bonds and external commercial borrowings in anticipation of continuous rupee appreciation. There is no need to take a position on the extent of depreciation that RBI is going to aim for in a particular year. A weak currency policy does not mean a policy of a depreciating currency. If ......

Read - Mint

Create awareness among consumers on credit scores: RBI

.........Delivering the keynote address at the fourth annual CIBIL Credit Information Conference here on Tuesday, J. Sadakkadulla, Regional Director (Chennai), RBI, said: “The key deliverable for CICs in the coming days would be to facilitate a smoother credit decision-making process and, thereby, bring down the cost of financial transactions and credit intermediation in the financial system for the benefit of the masses.”.........

Read | Business Line

Coin Exchange Mela by ICICI Bank in Pitampura, New Delhi

New Delhi: ICICI Bank, India’s largest private sector bank, today organized a Coin Exchange Mela at its Wealth branch in Netaji Subhash Place, Pitampura, New Delhi under the guidance of the Reserve Bank of India. The Coin Mela was organised to offer a free facility of exchanging currency notes with coins to the general public. ...

Read...........

Bank’s Pension Scheme - P. R. R. NAYAR

Octogenarian Shri PRR Nayar has been writing on updation issue relentlessly with all sincerity even though he is not office bearer of any organisation. His one more letter to the Bank, please read. Salute to him for his devotion to the cause of pensioners of RBI.

- L.R.Parab

Read - ReTyred Express

VITALINFO - A 'must' ReConnect.......

As you are aware that every morning you receive a copy of VITALINFO in your inbox.  It is sent by Sh Mangesh Tarambale, who is a member of our Group. I need not say that it is "must read" for all RBI people. It covers  all happenings and events in and around RBI. I can assure you once you read VITALINFO there is no need for you to go through so many Financial Papers.  It has a much wider circulation all over the  Globe. You can imagine how much hard work he must be putting into it to manage it alone. We must be thankful to Sh. Mangesh Taramble for sacrificing his nights for making our mornings bright. You will be happy to know that today we have provided  a link to VITALINFO on our Group's website. You can simply click at "Links" to access it. Wish you all the best. With regards 

- Moderator, RBIOA Group

Click to visit RBIOA Group

Dear Mangesh, I retired from RBI four years ago, but your VITALINFO keeps me linked to RBI and financial world.  It is really a commendable work needing very high level of dedication.  May God bestow on you good health and strength to take VITALINFO to higher heights.

- Shyam Sunder, Retired CGM, DEIO 

Wish VITALINFO many happy returns on its birth day.

- K.Kanagasabapathy 

Dear Shri Tarambale, 

This is to inform you that I got promotion as a Private Secretary in the month of August. I have come to know from my friends that you send “VITALINFO” to all the Private Secretaries everyday which is very informative and helps them in keeping themselves updated with the current internal as well as external affairs of the Bank. I therefore, request you to kindly add my name in your list, so that I can keep myself updated with valuable information provided by you . With warm regards 

- Manisha Thosar, Private Secretary

Dear Mangesh ji, Hearty congratulations on compoletion of 3 years of VITALINFO. You are great great and really i appreciate your hard work for the benefit of retired as well as working RBIites. Gold bless you!!!!!!

 – P.G.Gehani, Ex-PS to DG

VITALINFO and the morning cup of tea are what start our day in RBI. great work! Congratulations.

– A.Rajalakshmi

Microfinance empowering women in un-banked villages

.......However, there has been a cloud over microfinance groups, especially after a spate of suicides by women in Andhra Pradesh who were unable to withstand the coercive recovery methods. This is when the Reserve Bank of India stepped in and decided to grant the status of self-regulatory organisations (SRO) to industry associations of microfinance institutions operating as non-banking financial companies. The move is to make sure that these institutions follow prescribed guidelines.................

Read - HBL

Mahila Bank mulls childcare allowance for women staff

......While the salary offered by BMB is on a par with other public sector banks, it is trying to differentiate itself by adopting a more gender sensitive HR policy, said a senior Finance Ministry official. If the childcare allowance passes muster with the eight-member all-women board of BMB, then other public sector banks too, are likely to follow suit...........

Read - HBL

Banks to get ranked on service

........BCSBI, a Reserve Bank of India (RBI) initiative, plans to rank banks based on their adherence to banking codes - a list of minimum commitment to customers. In terms of the RBI mandate, at the time of opening a bank account, every customer will receive a set of banking codes from the bank.........

Read - TOI

Centre to bring urban co-operative banks under greater scrutiny

......"There is an effort to segregate the ownership of the UCBs as a cooperative society from their functioning as a bank. It can be done by creating a new organisational structure of board of management in addition to the present board of directors so that the banking functions can be directly monitored by RBI," the official said. This would empower RBI to take action against errant management...........

Read - IE

‘Submit report on irregularities in co-op bank in two weeks’

The Bombay High Court Tuesday asked the Maharashtra government to find out whether an offence was registered against the Mumbai District Central Co-operative Bank (MDCCB) in relation to alleged irregularities to the tune of Rs 1,500 crore. The court was acting on a petition filed by 25 co-operative societies who have claimed that despite repeated complaints, no action was initiated by the local police or the Economic Offences Wing (EOW).............

Read - IE

Inflation, a self-fulfilling prophecy

......If a weak(ening) economy would generate disinflationary forces (as the RBI asserts in its November 13 statement), we are not seeing — and have not seen — any evidence of this. As the chart shows, inflation has remained high and stubborn with an upward bias even as the economy has noticeably cooled. Dis-inflation, therefore, is not evident in the recorded data. So, how is the RBI confident now that the weak(ening) economy would deliver lower price level increases?........

Read - HBL

Are public sector banks to blame for rising NPAs? Yes

......Numbers suggests that public sector banks’ stressed are nearly 100 per cent of their net worth. And less than a third of these bad loans are provided for. It is not just PSB finances that will be at stake if the banks do not contain slippages in assets.......

Read - HBL

Are public sector banks to blame for rising NPAs? No

....Private sector banks have managed to maintain NPAs at a low level. Could PSBs have achieved the same? No. New private sector banks account for only 15 per cent of bank advances in India and only 13 per cent of corporate advances. At that size, it is possible to cherry pick one's clients and sectors. Public sector banks (PSBs) account for 80 per cent of total credit to industry (corporate credit, excluding retail an agriculture). If they were to decide to avoid an industry sector, it will be starved of credit and come to a halt. .......

Read - HBL

Turning a corner

OVER the past two years Indian officials have excelled at predicting with magnificent conviction that an economic recovery would happen in the next quarter, always the next quarter. As things steadily got worse, culminating in a currency scare that lasted from June through August, their credibility slumped in tandem with India’s growth rates. But now there is something to cheer about......

Read - The Economist

Tinker no more

....Reform has little use if arbitrary rules framed by different arms of different regulators and departments of government prevent it from being effective. The way forward has been outlined by the FSLRC, which has proposed moving away from the licence permit raj to regulated financial markets, the kind of liberalisation that was implemented for industry in 1991 but has still to touch Indian finance...........

Read - IE

Financial education is important even for children

..........For the girl child the RBI can better direct the banks to put across to the average Indian women homemakers and their daughters the need to save and not hanker after acquisition of more and more gold......

Read - Moneylife

Now, video chat with your banker through ATMs

Account holders can look forward to videoconferencing with bank executives through ATMs with NCR Corporation India unveiling its new machine which it describes as an interactive teller. In addition to videoconferencing, the machine allows the bank executive to remotely process transactions giving most of the bank branch functionality to the ATM. .........

Read - TOI

Bangalore attack: Banks asked to focus on ATM security

..........It was decided that the RBI would prepare a circular and come out with a schedule wherein all banks would be asked to compulsorily install CCTV cameras or intelligent cameras inside and outside their ATM kiosks with 90-day storage facility, a senior police official told PTI. These measures were necessary to avoid closure of ATMs by police for security reasons (as has been done in Bangalore), he said. The meeting was attended by RBI Chief General Manager R Keshavan..........

Read | Business Standard


Bangalore ATM attack aftermath: Life gets harder for guards

The recent ATM attack incident in Bangalore has not only left the entire country shocked, but also led to forced double shifts and extra hours for ATM guards, reports CNBC-TV18's Vineetha Athrey. It has also led to closure of ATMs in certain areas.......

Read.....

Now, a cover for card PIN-based frauds at retail outlet

The RBI has made keying in PIN at point-of-sale terminals mandatory for debit card use. The move, in place from 1 December,  is aimed at increasing the security of cards. But the irony is that POS is a crowded area, where chances of somebody seeing your PIN is high. If you are not careful while punching the PIN into the card machine, your card is vulnerable to frauds. But, did you know now you can actually get a cover against such PIN frauds?........

Read...................

Rural banks told to install CC TVs in a week

.........He also warned that he would write to the RBI if any bank fails to equip their branch with CC TV cameras. The SP also averred that he would take measures to stop the banking transactions till appropriate security measures were in place at the banks............

Read - The Hindu

Deft external management

.....That threat has receded, even as the special swap windows for FCNR(B) deposits and overseas borrowings by banks opened by the RBI have mobilised $34 billion in the last three months. These facilities, mainly targeted to attract Non-Resident Indian money, have done more to turn the tide and stabilise the rupee than what any IMF or World Bank programme would have achieved. But this is only the first step. A lasting solution to....

Read - HBL

FM’s defence falls flat: Gold smugglers make a killing as hawala premium doubles

...The World Gold Council, RBI governor Raghuram Rajan and finance minister P chidambaram have admitted a spur in gold smuggling into India after the government imposed curbs on the yellow metal. According to World Gold Council, gold is entering the country unofficially through India’s porous borders helped to meet pent-up demand, together with an influx of recycled gold that was drawn out by higher prices and promotions offered by retailers during the third quarter to end-September............

Read more at: Read..........

A Consistent Performer Who Leads From the Front

.......“She would take a personal interest in everything and take it to a logical end,” the person said. Now MD and CEO of LIC Housing Finance, Sharma has the advantage of having handled various key roles in the insurance sector. Among the departments she has handled over three decades are personnel, new business, policy servicing, finance and accounts, and estates. During her tenure in the pension and group scheme, the department became the best performer in LIC. ........

Read - TOI

SBI chief in panel

SBI Chairperson Arundhati Bhattacharya has been included as a member in the Standing Council of Experts to assess global competitive- ness of the financial sector with regard to transaction costs as well as tax rates and suggest reforms. The committee was set up in June this year.

The Hindu

DBS Bank appoints Rajesh Prabhu as CFO

.....“In light of the Wholly Owned Subsidiary (WOS) guidelines that have been introduced by the RBI, Prabhu with his detailed understanding of local and international banks in India will be an invaluable addition to the top management at DBS India as the bank looks to expand its Indian footprint,”.............

Read - The Hindu

Abraham Koshy is Federal Bank’s new non-executive chairman

The Reserve Bank of India has appointed Abraham Koshy as non-executive chairman of Federal Bank. Koshy has been an independent director on the private sector lender’s board since May 2007. A post-graduate in business administration from Cochin University, .......

Read - HBL

Banks, pillars of growth?

........One time-tested way to shake incumbents out of their inefficiency and sloth is to introduce competition. So, the governor is justified in thinking that as more foreign and private participants enter the banking sector, public sector banks will have no choice but to get their act together. In principle, this is sound thinking. There are at least two exceptions. One is an Indian phenomenon and the other applies to the financial sector globally................

Read - Mint

Market hopes RBI will stick to early data release

......“If Rajan could release the numbers one month ahead of schedule, it means the data are available. But It’s strange no one in the RBI ever thought of releasing it early despite the impact of the numbers on general policy-making,” a senior banker said. Market participants now expect the central bank to continue the trend of releasing data as soon as they are available.........

Read | Business Standard

M. V. Tanksale is IBA’s new chief executive

M.V. Tanksale, former Chairman and Managing Director of Central Bank of India, has taken over as Chief Executive of the Indian Banks’ Association. Tanksale succeeds K. Ramakrishnan, who was at the helm of the Association for five years up to November 30, 2013........

Read - HBL

Three cheers for VITALINFO

Mangesh has hitched his wagon to a star,

He and VITALINFO will travel very far,

The news items served up daily are like tasty cookies in a jar,

Mangesh picks them up while dashing around town in his lovely sports car. 

- Frank

Vital Info’s three – and it calls for celebration,  

It’s your baby, conceived and nurtured with pure dedication.

To collate information, catering to the needs of the RBI fraternity,
At four you begin ; when in deep slumber - the rest of our community.   

Laurels and accolades, exemplify your outreach and popularity,

It’s no mean feat to sustain this daily contribution, with alarming alacrity.  

News paper reading, now a chore so mundane and boring,

For addicted we are to your daily Vital Info serving.  

Oh Dear Mangeshji, this little ode out of pure adoration,  

Vital Info’s three – and it calls for celebration.

- S Thomas Punnoose, MoF

FAXation

Dear Friends, 

Appended below is the copy of letter sent by Forum of Retired Employees of RBI, Chennai to the Governor by FAX today on Updation of Pension.

Yours,

B.Chandraiah

Read - ReTyred Express

Vishwavir Ahuja taps BankAm learnings to build Ratnakar Bank’s profile

For a sports fan, getting to watch Sachin Tendulkar's final Test match from the president's box was a rare privilege. But imagine being too busy with work to go when even Reserve Bank of India Governor Raghuram Rajan found the time to watch the game. Then again, that's just the kind of focused professional Vishwavir Ahuja is. The managing director and chief executive officer of Ratnakar Bank had a strategy meeting that was too vital to miss....... 

Read - ET...

RBI Governor Raghuram Rajan watches Sachin at Wankhede

Photo sent via e-mail by

- S.Venugopalan, Chennai - 600 041
Ph: +91 44 42151321

Link

Rates of little interest

The outlook has turned in favour of high interest rates in the foreseeable future. High inflation and RBI’s commitment to reduce inflation through interest rate calibrations implies that the cost of borrowing would remain high and could even increase. Some of the major commercial banks raised their base rates in the last month. This would hurt the profits of the corporate sector because a change in the base rate impacts the full spectrum of borrowers from banks.............

Read - FE

Better HR, better banks

....... PSBs are in no way inferior and have the resources and infrastructure to show greater levels of efficiency. What is lacking is a proactive human resources (HR) policy. The real HR policy draws a line of demarcation between performers and under performers, so that it is able to identify those who excel. ..........

Read | Business Standard

Back to gold?

The article “Let’s go back to good old gold” (Business Line, November 29) should be music to the ears of the World Gold Council. In an era where gold prices are expected to go down, the author’s recommendation for an increase in gold’s share in reserves management will reverse this trend. While I regard gold as an equivalent monetary asset in times of need, I would not like to go with the author in recommending a one-third reservation, as it will impact the monetary policy to a greater extent. Gold is a precious metal, preferred by households. The way the author has argued for gold, I am tempted to work out an approach for bringing real estate under reserves management. However, all assets cannot be brought under reserves management; only monetary assets can be included. Though gold is also a near-equivalent monetary asset, providing for a larger share may be counter-productive and will bring down the economic performance. Also, it will lead to greater focus on gold price movement too, which may not always be in the best interest of reserves management. 

- Raghavan Guruswami (HBL)

Bank for and by women a step forward in India

………Joyashree Roy, a professor of economics at Jadavpur University in Kolkata, said a women’s bank seems more like a political stunt than a genuine policy decision guided by socio-economic factors“  An exclusive bank for women, especially in an urban society, is not relevant anymore,” she told the Bangkok Post. “In some rural societies where women are not allowed to go out alone or interact male strangers, a bank such as this may help.” An exclusive women’s bank, Roy said, does not bring about a change in the mindset of the society toward women or address gender-related social issues adequately. Interestingly as of now, all the branches of the bank are in the cities — Mumbai, Kolkata, Chennai, Bangalore, Guwahati, Ahmedabad and Lucknow. The Reserve Bank of India normally requires 25% of a bank’s branches to...

Read - Bangkok Post

RBI begins process to determine systemically important banks

......RBI on Monday released the draft framework which outlines the methodology to be adopted by the RBI for identifying these lenders and regulatory policies. Such banks will have higher capital requirement and regulatory oversight. RBI has sought comments till 31 December.........

Read - Mint

India in for a slow and stable 2014

.......Can it get worse? Once again, if the pundits are to be believed, it cannot get worse from here. After two years of steady fall in economic growth and earnings, it would appear that we've hit rock-bottom. With economic growth picking up marginally to 4.8% in the July to September quarter, despite a fall in government spending compared to April to June quarter this year, GDP growth has remained range-bound. While ..............

Read | Business Standard

Insurers not hopeful of banks entering broking business

.......“The industry was not too hopeful of large private and public sector banks entering the insurance broking segment, but we had thought smaller public and private sector banks would see a business opportunity here. But with RBI putting stringent norms, these banks, too, will be dissuaded,”............

Read | Business Standard

SBI loan fraud case: Private firm executive gets limited protection

NEW DELHI: A private firm executive, who has been named as an accused along with a Deputy Managing Director of State Bank of India in a case of alleged graft in disbursal of loan of above Rs 400 crore, was today granted "restricted protection" from arrest for three weeks by a Delhi court. 

Read - ET

SBI says busy season fails to lift credit off-take

......On reports of the RBI pulling up banks for not transmitting the twin rate hikes, the SBI official said it was not fair to say RBI has some grave reservations on the issue, which got discussed at the customary post policy interaction between RBI and bank chiefs last week. 

Read - ET

Sumit Bose likely to head PFRDA

..........Bose, a 1976 batch Indian Administrative Service officer from the Madhya Pradesh cadre, is retiring in March 2014. As the selection process would be finalised only by January or February, Bose would be in a position to take up the role, said an official who did not wish to be identified as the government would also consider other names who apply for the post before finalising on the PFRDA chairman.............

Read | Business Standard

Banks Prefer ‘Security’ to Lending Risks

Banks are parking surplus funds in mutual funds and government bonds in the absence of attractive lending opportunities. Investment by them in mutual funds surged to . 60,883 crore on November 15 from . 27,090 crore at the end of September, despite the Reserve Bank of India (RBI) wanting the institutions to focus on the core business of lending. As for government bonds, the banks have exceeded the minimum statutory liquidity ratio of 23% of deposits by close to 7 percentage points...........

Read - ET

Banking hours

Bank unions’ demand for a five-day week work regimen/schedule and their suggestion to make up the loss of one working day by suitably extending the business hours from Monday to Friday (Business Line, December 2) is fair and worth considering, in view of the electronic banking channels available. Bank staff are perforce doing almost a full day’s work on Saturdays within lesser working hours. The experience/feedback is that a higher number of banking frauds are being committed on Saturdays as would-be-fraudsters are aware that the staff are over-stretched to finish the work in time. When the RBI observes a five-day week, why should it be denied to the other banks? 

- C. G Kuriakose (HBL)

Banking precautions

......... The very nature of the banking business has become competitive. Those who have opted out of the banking race will eventually celebrate their decision, and those who have been granted licences will regret their diversification. It is not the Reserve Bank of India's mandates that would mar their prospects. Shrinking net interest margins, continuing defaults resulting in higher level of non-performing assets, poor legal solutions, are enough to kill the industry...........

Read | Business Standard

RBI panel for buffers of up to 2.5% of risk assets

.....B Mahapatra, RBI Executive Director and head of the panel, has linked the buffer capital to the credit-to-gross domestic product (GDP) ratio, which tends to rise during economic boom and fall during a downturn. RBI may also consider indicators such as growth in gross non-performing assets, the industry outlook assessment index and the interest coverage ratio for CCMB...........

Read | Business Standard

Central bank for gradual phasing-in of CCCB

The RBI on Monday placed on its website a draft report for implementing the countercyclical capital buffer (CCCB) framework. The report suggests the need for setting aside upto 2.5% of risk-weighted assets based on the credit-to-GDP ratio and growth in gross NPAs of banks. "Lower threshold of CCCB when the buffer is activated may be set at 3 percentage points of the credit-to-GDP gap, provided its relationship with GNPA remains significant and the upper threshold may be kept at 15 percentage points of credit-to-GDP gap," the report says. .......

Read - FE

CAD to remain within limit: Chidambaram

.....Encouraged by better-than-expected growth in the July-September quarter, Finance Minister P. Chidambaram, on Monday, expressed confidence that the economy would expand by 5 per cent, and the fiscal and current account deficits would remain within limits, notwithstanding the present stress. “We are going through a period of stress, but there is a ground for optimism... We hope things will become better in the second half of the current fiscal (2013-14). We hope to achieve a growth rate of 5 per cent,”........

Read - The Hindu

Deciphering the new growth normal

......Slower demand for credit had been pushing banks to buy government debt, causing bond yields to collapse. Banks' credit-deposit ratios took off only from late 2003. Additionally, the build-up of global liquidity cycle coincided with the boost to domestic demand from an exceptionally good monsoon in 2003. Also, there was a lot of underutilised lending firepower with local banks that began to be put to use. Thus, a boom in both external and domestic liquidity contributed to the subsequent eye-catching upswing in economic growth........

Read | Business Standard

Fix This Financial System - Varun Gandhi

......Our financial regulators desire independence and institutional support. Today, work is allocated between the RBI, Sebi, IRDA, PFRDA, FMC, SAT, DICGC and FSDC, leaving significant gaps, agency overlap and the potential for regulatory capture. As proposed by the Financial Sector Legislative Reforms Commission, the RBI should focus on formulating monetary policy, along with enforcing consumer protection in the deposit banking and payment systems. .............

Read - ET

Banks cap foreign spends on cards to check frauds

...........In the last couple of weeks, a few foreign and domestic banks sent text messages or e-mails to their card customers, informing them their cards would have limits for international transactions. These limits, however, will only be applicable for foreign transactions and will not impact any spending done within India. Customers have also been allowed to increase or decrease the cap by contacting their respective banks............

Read | Business Standard

Reserve Bank revises norms on general credit card scheme

......It clarified the issuance of GCC would not prevent banks from issuing any other credit card to their customers for their consumption needs. Consumption credit provided by banks is to be reported separately under the head of overdraft or consumption credit in the FIP reporting format prescribed by RBI. "These guidelines will supersede the GCC guidelines issued by Reserve Bank of India in December 2005 and May 2008," the central bank said.

Read | Business Standard

Mobile payments are gaining currency

......According to the report, the introduction of IMPS has been the biggest driver of mobile payments since the RBI gave the nod for transactions over mobile phones in 2005-06. The data indicate that IMPS, which was launched in India in November 2010, is finally beginning to gain acceptance among cell phone users. The facility is provided by the National Payments Corporation of India (NPCI) through the national financial switch. IMPS offers instant, 24x7 inter-bank electronic fund transfers through mobile phones in a secure manner............

Read - HBL

Cyber criminals try to steal passwords of PNB customers

......“Last week, Websense Security Labs came across a phishing email targeting PNB customers. The phishing attack was aimed to obtain password of corporate and individual customers,” Websense Regional Director India Surendra Singh told PTI. PNB is not the client of the company, but these phishing mails were sent to several individuals and some corporate who are clients of Websense, he added. PNB officials were not immediately available for comments...........

Read - HBL

Chinks in ATM armour bared

....“The ATMs directly managed by SBI are manned. Some that have been outsourced do not have guards. After today, we think security personnel must be deployed at all kiosks,” she added. The SBI has some 100-odd ATM kiosks in the city, of which nearly 30 are outsourced. Many other banks, like PNB, too have unmanned ATMs. Subhash Chandra Arora, AGM of PNB, admitted that only their fringe kiosks are manned, whereas the ones in the city are not. He sought refuge in an RBI guideline that asks people not to resist bank/ATM heists, risking one’s life. He also insisted that deploying security had its own flip sides.......

Read - The Telegraph

ATM – All Time Money

......That is the scenario of capital ATM functioning, what about rest part of the state and districts? Unbothered about their consumers as many banks even after repeated callous have not aligned to justify uninterrupted service. RBI in one side asks bankers to provide ease access of ATMs with non-stop service in almost all the populated places where the banks pay no heed to consumer satisfaction and flexibility. So, it’s rather doubtful to say that ATM stands for All Time Money observing a real case scenario of pathetic condition being facing by the consumers hailing from the state like Sikkim. 

Read | Voice of Sikkim

How to Stay Safe with the New Card Payment System

...“The RBI had given instructions to banks that they should convert all magnetic stripe cards into chip cards and also, that all debit and credit cards will be used domestically only. Those who want to go abroad should get a chip card issued and can spend as per FEMA regulations. Those who have not got chip cards because banks have not issued them will have to get a threshold limit approved, which in any case should not be more than $500 per day. Banks can approve a higher limit after mutual discussions with the customer on the basis of spends made during earlier visits,” says AC Mahajan, chairman, Banking Codes and Standards Board of India......

Read - ET

RBI’s trend & progress report on banking - Dr.S.S.Tarapore

.......There is need for an explicit policy statement that there would be a break from earlier policies and public sector banks will no longer bail out failed banks. The system should no longer countenance profits being private and losses being public. If such a policy is cast in stone, new banks will have to earn the depositors’ trust only by hard performance. A prerequisite would be that the regulator would put a premium on prompt corrective action, which would be made public, bearing in mind depositor protection and as such it would lead to a more effective regulatory system................

Read - FPJ