.........The report quotes the governor as saying the RBI considers it prudent to be prepared for the eventual exit from low rates. The central bank has pushed the average duration of bond holding to three years and built up adequate reserves while also curbing volatility in the forex market. Rajan also said that the limits for government securities will be steadily increased but the RBI is comfortable with the current limits. On the price rise, the governor observed that while inflation was off peaks, it remained high due to supply-side rigidities. Nevertheless, the aim was to achieve 6% by January 2016 and to fight rising inflation just once. However, he added that...........
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, September 6, 2014
Consumer inflation still high says Raghuram Rajan
India’s consumer price inflation (CPI) may be below its peak but is still high due to supply-side constraints, while food prices remain another concern, Citigroup quoted Reserve Bank of India governor Raghuram Rajan as saying during an investor conference. “Inflation still remains high on supply-side rigidities. Food inflation is a source of discomfort and given the sub-par monsoon this year, there is a need to keep an eye on food inflation,” Citigroup reported Rajan as saying at a meeting with US investors on Thursday..............
Making it affordable
...............In the past one decade, there has been surge in funding to long-term advances in the form of home loans. As such the portfolio towards long-term lending is increasing rapidly in the books of every bank, thus posing a big challenge for the ALM in managing asset-liability mismatch. The need of the hour is to facilitate banks to generate long term, cheaper and sustainable funds for which the RBI has initiated a few noteworthy steps. It issued a circular on July 15 to all banks, permitting them to issue long-term bonds with a minimum maturity of seven years to raise resources for lending to infrastructure projects and affordable housing. The National Housing Bank may follow suit and may issue similar guidelines to ......
RBI to hold interest rates on September 30: report
....According to the global financial services major, the Consumer Price Index-based inflation is peaking off and is expected to be around 7.5-8 per cent in September. "We expect the RBI to begin to cut rates starting February with stable oil prices and rupee providing comfort that CPI inflation will come off to 6 per cent by early 2016," BofA-ML said in a research note. The Wholesale Price Index-based inflation fell to a 5-month low of 5.19 per cent in July on account of decline in vegetable prices, while the CPI-based retail rose marginally to 7.96 per cent in July, from 7.46 per cent in June.....
Don’t confuse luck with performance
........There are two indications that it was pure “dumb luck” that allowed GDP growth to register a two-year high in the very first quarter of the Modi regime. The first piece of luck was due to the often over-quoted “base effect”, i.e., the corresponding quarterly figure last year was low, and therefore the bounce-back was above normal. But how low were last year’s April-June numbers? As it turns out, the base was not only low, but very low. As readers of this column know, the ministry of finance (and RBI!) cannot decipher this simple fact because they rely on estimates of year-on-year (yoy) growth; this estimate hides considerably more than it reveals and can lead to grievous errors of interpretation. For example............
SBI launches new products for children
.......Pehla Kadam is a Savings Bank account for minor of any age operated jointly with his/her parent/guardian, while Pehli Udaan is a singly operated Savings Bank Account for a minor aged 10 years and above and who can sign uniformly. Specially branded passbook and cheque book have been designed for these products. All the account holders will be given an exclusively designed personalised photo ATM-cum-Debit Card, the bank said in a statement......
The Great Salary Puzzle
..............With the arrival of technology (core banking), clerical jobs are no longer indispensable. But clerical staff can’t be promoted to the officer cadre merely on the basis of years of service — a similar move in the mid-1980s to 2000 period hit the quality of middle management. For the talented, there’s no reason to stay on in banks which make no ‘concession’ to their qualities. As former RBI Deputy Governor K.C. Chakrabarty says: “You need to manage people. And for this you need to discriminate between people; I mean positive discrimination.” Is lateral recruitment the way forward? “If you hire from top B-schools, chances are they will leave the organisation after a few years if their ambitions are not fulfilled,” says Kumar. “You may also find that you have hired the worst of the best.” ............
Bank Officers Letter to Prime Minister Narendra Modi for Intervention in Wage Revision
......Incidentally wage revision of the bank employees who are the lowest paid in comparison to peer sector is due since November 2012 and the snail pace at which the Indian Banks’ Association is dealing with the matter is causing lot of anxiety, anguish, and frustration amongst all of us. While we once again assure you of our wholehearted involvement in any step/action call given by the Government under your leadership, we request your indulgence in the matter of our wage negotiations as per the Charter of Demand submitted by us on 30th October, 2012, to the Chairman of IBA, delay in which has become a matter of concern for all of us..........
Read..........
IBA Invited UFBU for Next Round Wage Talk on 17 Sept on PM Intervention
......As information received from AIBOC General Secretary Sri Harvinder Singh that IBA has invited UFBU for wage revision talk on 17.09.2014 in Mumbai at 2 PM. The banking sources said that this is going to be happen on intervention of PM Shri Narendra Modi who is much impressed with general bank employees dedicated support to govt programmes implemention like PMJDY ...........
The fault lies elsewhere - R.G.Nakhate
My View on "RBI norms may hit co-op depositors":
This is with reference to the article in the TOI,"RBI norms may hit co-op depositors ". A retrograde step by RBI. It may result in run on the deposits of Co-operative Banks or the depositors would not in future risk to put more than Rs.1 lakh (fully protected insurance cover is Rs. 1 lakh including interest earned on the amount deposited). The depositors, by and large, put their money in banks to earn some interest as they consider that they cannot take risk in investing in mutual funds and ever volatile unpredictable share market. Many depositors are attracted to put money in Co-operative banks as they generally offer half to one percent more interest on term deposits. It is not fault of the depositors if the Co-operative banks (or any other sector banks) fail. The fault lies elsewhere, no need to elaborate.Why mete out punishment to gullible depositors?
With a view to ensuring public confidence and providing a greater measure of protection to depositors (small depositors in particular) the Government and RBI established Deposit Insurance Corporation (DICGC) way back in 1962. The limit of Insurance Cover which was originally fixed at Rs.1500, was revised to Rs.5000 in 1968, to Rs 10000 in 1970, to Rs.20000 in 1976, to Rs.30000 in 1980 and to Rs.100000 from May,1993. GOI/RBI/DICGC have not (It is against the interest of common man / depositors) increased the limit of deposit insurance cover for the last 21 years though the deposits have grown considerably. The Deposit Insurance Fund of DICGC which was Rs.312 crore as on 31-03-1993 has gone up by about 115 times in 21 years to Rs.36120 crore as on 31-03-2013 which is indicative of deposit growth. The claims settled, since inception of deposit insurance, too have gone up from Rs.178 crore to Rs.4505 crore during the same period. (Source : DICGC Annual Report 2012-13) But, it is high time to increase the limit of insurance cover to Rs 8 lakhs to Rs.10 lakhs. (at least to Rs.5 lakhs). Rupees ten or five lakhs of today - in 2014 is not even worth to Rupees one lakh or half of one lakh of 1993.
DICGC, RBI and GOI should take necessary steps to increase the limit of deposit insurance. May they not subject the depositors to suffer; the depositors (have) put their hard earned money, their life savings in the co-operative banks reposing full faith in BANKS, in DICGC and in RBI (the Regulator),
- R.G.Nakhate
‘Ownership rights’ uncovered
My View on "Jan Dhan cover: LIC says no to premium":
The initial response to Jan Dhan from implementing agencies and prospective beneficiaries has been encouraging. The ‘packaging’ was attractive with bank account, a ‘credit’ card and elements of life insurance and eligibility for a small overdraft conceptually conceived as part of one financial product. It is understandable that the new government did not get enough time to refine all linkages and take into confidence all stakeholders. This does not absolve government’s responsibility to find funds for financing projects it wishes to implement. Even indirect coercion to force LIC or public sector banks to incur losses in the process of implementing schemes beneficial to society is not welcome. LIC’s dissent has to be seen in this perspective. Transparency in accounting each rupee with LIC and the depositors’ funds with banks is a must. Government should not use its ‘ownership rights’ to divert illusory surpluses with statutory bodies and public sector undertakings, howsoever popular the causes it proposes to finance be.
- M G Warrier, Mumbai
MFIs told to bring customers for Jan Dhan Yojana
.........Several other MFIs are also experimenting with cash-less transactions in microlending. For example, Janalaskshmi has tied up with DCB (Development Credit Bank) to launch a co-branded prepaid card for disbursal of small loans to its urban clientele. “For MFIs, nearly 95 per cent borrowers are women. So MFIs can not only facilitate opening bank accounts for women, but also their spouses, which could take the number to nearly 40 million. MFIs can also play other roles in the Jan Dhan Yojna, like doing due diligence for banks in case of overdraft facilities,”...........
`RBI's inflation focus means rates won't change for 6 mths'
........I don't think there is a general perception that NPAs are because of wilful defaults. Projects are built on certain assumptions and if they (raw material supply, timely completion and interest rates) change, they impact project quality... and that is what has happened in the last few years. This leads to higher leverage as they are not able to repay because the project is not generating cash.There may be some cases of wilful default, but for banks it is always possible to identify if the external environment or internal capabilities are to blame. It is not difficult to identify a wilful defaulter.......
Tops Indian banks ponder over proposed 'Gold Deposit Account' scheme
........ the tenure of gold deposit would be three years. The interest will be calculated based on the prevailing rates. Upon maturity, the investor’s account will be credited with more gold equivalent to the amount of interest earned during the tenure. The banks can either deposit the collected gold with the Reserve Bank of India (RBI) or lend it to jewellers. The scheme has already been formally approved by the RBI, subject to implementation of fool-proof mechanisms to determine the purity of deposited gold. According to MMTC-PAMP India, advanced software to ensure purity checks through more than 250 hallmarking centres in the country is in its final stages of development. The banks are now being asked to forward their suggestions ..........
Uber cool but unsafe?
..........Today, proponents of the Uber model aver that ‘innovation’ allows the customer to enjoy his ride and disembark at his destination without fumbling for cash or having to enter an authorisation PIN, as card details are pre-stored. This innovation is not new; the hotel industry has been using it for a long time with a pre-authorisation taken at the time of booking. The only difference being, that if mandated, you will still need to use 3D-Secure whilst making the booking. So, in a trade-off between risk and convenience, what would you choose? Risk your card being used by a hacker in ‘Nigeria’ or protect it using 3D secure?........
No takers for R20,000-cr NPAs as banks, ARCs spar over valuations
.........The head of a large ARC said reconstruction companies were not ready to buy assets unless banks offered them loans at attractive reserve prices. “Lenders should realise that since we have to pay 15% upfront now compared with 5% earlier, the reserve price should be lower. However, banks appear to be unwilling to drop the value of the assets," he observed. Last month, Reserve Bank of India (RBI) had asked asset reconstruction companies (ARCs) to increase the mandatory upfront investment in security receipts (SRs) to 15% from the earlier 5% to ensure ARCs have 'more skin in the game'.............
Wilful defaulter tag a ‘powerful weapon’ for creditors
......“The wilful defaulter tag is a powerful weapon in the hands of creditors for resolving distressed assets. It shuts out access to credit within the Indian financial system for a borrower,”.......
PNB challenges HC order allowing lawyers to represent Kingfisher
Punjab National Bank (PNB) has challenged a Delhi High Court order allowing lawyers to represent Kingfisher Airlines in proceedings initiated by the bank to decide whether the grounded carrier and its regulators are wilful defaulters for non-payment of dues. PNB in its plea has sought setting aside of the High Court’s August 28 order which had also stayed the bank’s notice to the extent it threatened to hold the airlines and its guarantors United Breweries (Holdings) Ltd (UBHL) and Vijay Mallya as wilful defaulters in the event of no reply within seven days from August 21........
Syndicate Bank CMD, others told to reply to CBI plea
A Delhi court on Friday sought response of Syndicate Bank chief managing director Sudhir Kumar Jain, CMD of Prakash Industries Ved Prakash Agarwal and another accused, arrested in a bribery case, on CBI's plea seeking to record their specimen voice for its ongoing investigation. Special CBI judge Swarana Kanta Sharma directed Jain, Agarwal and Vineet Godha to reply on September 10, when the court will also hear the arguments on CBI's plea. The court also said that.........
Friday, September 5, 2014
Raghuram Rajan’s first year at RBI: Making a difference to continuity
Singular vision paying off for India’s Reserve boss Raghuram Rajan
..........Mr Rajan came to the job with no policymaking experience. It had been, he said, a bit of a culture shock to go from the freedom of being an outside critic. “Now that I’m on this side, you have people saying what you’re doing is terrible, it’s going to lead to problems,” he said..........
The man who turned the economic tide
...........The good news though is that he seems to have struck a good rapport with the powers in New Delhi. This is important, not just in the conduct of monetary policy, but also in the context of the recommendations of the Financial Sector Legislative Reforms Commission which, if implemented, will curb the role of the central bank. If Dr. Rajan’s good understanding with the Centre is sustained, we could well see more reforms from the RBI in the months ahead..........
Mr. Rajan’s Bag of Low-Key Tricks
.............Whether Mr. Rajan’s legacy will be as the man who tamed Indian inflation is still unknown. But he has deployed other less-understood technical measures since taking office as well, including changing the way the RBI lends to commercial banks. If nothing else, he may earn a reputation as a central banker with low-key smarts.
Super skills okay, but did external factor also aid Rajan?
..........Without taking any credit away from the man-of-the-moment Raghuram Rajan, who completes one-year in office today, many argue whether he was also lucky in terms of the events – both domestic as well as global – that took place in the days after he assumed office. Jahangir Aziz, chief economist at JPMorgan calls it more as baptism by fire.......
Narendra Modi and Raghuram Rajan: Tale of contrasting debuts
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| "NamoRa" File photo |
.................Both took over their respective positions at a time when the economy was, and perhaps still is, in doldrums. Both were faced with fairly stark choices. Their predecessors—Manmohan Singh and D. Subbarao—had left them with unenviable tasks. Rates for economic growth and inflation had swapped places. We were growing at less than 5% and had an inflation hovering around 9%. Both leaders had to make a clear choice in their policy stance in order to prevail. They simply could not afford to carry on with the muddled approach..............
One year later at RBI, rockstar Raghuram Rajan has many battles to fight
When Raghuram Govinda Rajan took over as the 23rd Governor of the Reserve Bank of India (RBI) on 4 September, 2013, the former IMF chief economist was seen as a long-awaited saviour to rescue a faltering economy, than just a mere, routine change of guard at the Mint Road. There was a mountain of expectations built around Rajan. Almost everyone praised former finance minister P Chidambaram and (for a change) the UPA government for choosing Rajan as the government’s money manager.............
Rajan has done well but his task is incomplete
............Dr Rajan deserves most credit for his publicly stated resolve not to look at quick-fix solutions, but to focus on correcting the larger structural issues. Given the Indian environment, achieving even a part of that mission before he leaves office would be a considerable achievement.
Ignoring Doubters, Indian Central Bank Chief Tackles Inflation
.........."For long, we've been punching below our weight," he said in the interview. "Today, we're still not there, so if someone gives attention to us, it is because of where we will be, rather than of where we are now."............
Regulators always live in interesting times
I visited one of the deputy governors at the Reserve Bank of India (RBI) a couple of weeks ago and discussed, amongst other things, my continuing obsession with the fact that volatility is so low in markets everywhere. He pointed out that, since the financial crisis, regulators are active everywhere. Not only have banks been slapped with huge fines - although, to my surprise, there have been no prison sentences - but capital requirements been cranked up substantially - and appropriately, I might add. As importantly, regulators are much more proactive. If there is ........
‘RBI needs to focus on banking needs of new States, North-East’
.........Availability of adequate currency notes/coins, development of cooperative and non-banking finance companies, suitable banking network, financial inclusion and financial literacy are issues that need to be accorded high priority. A department for currency management should, ideally, be opened in all tier-III offices and there should be recruitment of staff at the base level periodically. The HR Department had sought the views of the Association in response to its document on the ‘operational blueprint for organisational restructuring and implementation of the human resources initiatives.’.......
No easy path to higher growth - Dr.S.S.Tarapore
...........There are always aspirations for a quick return to the halcyon days of 9 per cent growth. But the RBI does well to caution that for a medium-term growth of even 7 per cent per annum, it is imperative to have better microeconomic policies to improve activity and productivity; this should go along with a conducive macroeconomic environment with reasonable, positive rates of interest, low inflation, moderate balance of payments and current account deficit, (CAD) and a low fiscal deficit.....
Forget Interest Rates, Just Grow!
......Growth is vital. So, if spurring growth is as easy as lowering the interest rate, why is there any hesitation? This begs the question: how should we think about the RBI-set interest rate? What evidence is there to suggest that lowering of the interest rate induces investment and leads to robust economic growth? One would expect investment to respond to lower interest rates and a favourable profit outlook. The theory is compelling, but it's largely silent on the relative importance of these two factors........
Finance, credit and markets - R.Gandhi
Speech by Mr R Gandhi, Deputy Governor of the Reserve Bank of India, at “Credit Summit India 2014”, organised by Association of International Wealth Management of India and National Institute of Securities Market (NISM), Mumbai, 26 August 2014
...........Although banks play an important role in these economies by channeling funds from depositors to companies without access to capital markets, banking itself, says Nobel laureate Merton Miller from University of Chicago, is “ basically a 19th century technology”. Today’s emerging Asian economies do not have well-developed capital markets and so remain heavily dependent on their banking systems to finance growth. However, ............
Financial intermediation for all – economic growth with equity - Deepali Pant Joshi
Speech by Dr Deepali Pant Joshi, Executive Director of the Reserve Bank of India, at the Financial Inclusion Conclave of Dun & Bradstreet, Mumbai, 26 August 2014
......“Technologies that reduce asymmetric information in credit markets are technological innovations which can be leveraged for improved borrower identification. Bio-metric authentication helps to reduce leakages and ensure that Government transfers direct to bank accounts achieve the desired objective of financial inclusion, thus creating a better enabling environment and increasing penetrative outreach for optimal results.”“Financial inclusion is critical to ensure equitable economic growth and a just Society.”Leveraging technology makes it easy to leap frog the barriers of geography for sustainable, scalable financial inclusion.Empowering Small Banks Alternate types of Payment Banks are also viable options. We also ........
Moneylife Foundation selected for the 10th MR Pai Award
...........Moneylife Foundation has been nominated for the 10th MR Pai Award, instituted in memory of the man 'Reader's Digest' once called, 'Champion of the Consumer'. Dr Deepali Pant Joshi, executive director of Reserve Bank of India (RBI) would present the award to Moneylife Foundation on 16th September at 5.30pm at IMC in Mumbai. This award, in the memory of well-known consumer activist Mangalore Ranga (MR) Pai, was instituted in 2004 by Punjab and Maharashtra Co-operative Bank Ltd. The Award is given to.........
UFBU - IBA Stalemate Seems to be Over
Reports indicate that the negotiating meeting for Xth BPS has been now called on 17th September, 2014 at 2.00 PM. Who has bent? IBA officials are likely to meet DFS, Ministry of Finance on 8th September 2014 for finalising their strategy. Hope it will not turn into another Lunch Party. Report to follow.
High Flyer
After breaking into the all male club that was the Top 10 of the India Inc's Most Powerful CEOs listing in 2010, Chanda Kochhar has remained there for the past four years as India Inc's No.1 woman CEO. In a list dominated by promoters, she is the country's most powerful professional CEO. And as CEO of ICICI Bank, she also happens to be the country's most powerful banker. Ms Kochhar spoke with CD minutes before taking off on a flight to Delhi. Edited excerpts:..........
Read - ET
Read - ET
'We are not growing much,so dont need more capital
Arundhati Bhattacharya, who completes a year as State Bank of India chairman this month-end, says she sees much more optimism now than six months ago. In an interview with Manojit Saha & Abhijit Lele, she says she expects stalled projects coming back on track in two quarters. Edited excerpts........
RBI norms may hit co-op depositors
..In its latest circular, the RBI has said that under the new guidelines, the acquiring bank should not incur any loss arising out of the said merger or transfer of assets and liabilities of cooperative banks. “Big depositors holding deposits in excess of Rs 1 lakh each will be required to sacrifice in proportion to the deposit erosion of the target bank,” the circular said........
Read - TOIShriram seeks clarity on niche bank operation
.............“We have written to the Reserve Bank of India (RBI) if one promoter can float multiple banks with different managements and different boards,” said G S Sundararajan, group director. “In case it is allowed, we would be keen to look at wholesale consumer banks and small banks as well.” In a major shift in its traditional stance on bank licensing, RBI has said it would allow niche banking activities and invite applications for differentiated licences, along with those for a universal lender.......
RBI directive to banks on KYC norms for medium and low risk customers
The Reserve Bank of India on Thursday asked banks and all India financial institutions to dispense with the requirement of ‘positive confirmation’ at two/three years in respect of medium and low risk customers respectively. Positive confirmation pertains to obtaining Know-Your-Customer related updates through e-mail/ letter/ telephonic conversation/ forms/ interviews/ visits, etc..........
RBI begins review of Jan Dhan rollout
..............."Besides doing checks, the effort is to find out challenges and hitches being faced by bankers. This is not a fault finding exercise. The aim is to take feedback and attempt to provide timely support, as the targets are stiff," the official said. At the apex, a panel comprising the finance minister, RBI governor and finance ministry heads will take stock of the progress.........
Withdrawal Cap in Jan Dhan Yojana may Deter Depositors, Bankers Say
.......“Once you tell people that they may not be able to withdraw more than Rs 10,000 per month, some fear their money will be locked in case of emergency,” said an SBI branch manager, requesting anonymity. A finance ministry official, however, told ET that accounts opened under the scheme were governed by the Reserve Bank of India’s guidelines for ‘small accounts’. “We do not expect these small account holders to withdraw more than Rs.10,000 per month,” said the official, who did not wish to be identified.........
Jan Dhan cover: LIC says no to premium
..............While the insurance behemoth has agreed to extend life cover, it has conveyed to the Finance Ministry’s top brass that it is in no position to bear the premium cost, sources close to the development said. Even a premium as low as ₹100 for every life insurance contract with a sum assured of ₹30,000 would mean an outgo of at least ₹750 crore, a rough calculation shows............
Outlets everywhere, not many to bank on
..........The problem is set to grow following issuance of 75 million new RuPay cards in the next six months with the launch of the Jan Dhan Yojana. In addition to the problem of long queues at ATMs, there would be the problem of guiding new cardholders, especially in rural and semi-urban areas, on how to use those cards, some bankers told Business Standard. "Biometric cards, though costly in the beginning, are very simple to use. And they mitigate the risk of theft or fraud. RuPay cards will entail a lot of guiding from banking staff to new customers. That may result in hiring caretakers at ATMs who will help customers. Then there is the risk of pin-based cards being misused,".............
ICRA: Fresh NPAs on uptick for PSBs
...........However, ICRA highlighted that there was a significant drop in fresh referrals to the CDR (corporate debt restructuring) Cell for restructuring during Q1, FY2015. If the current trend were to continue, one may expect some containment of the standard restructured book. Overall, the Gross NPA percentage plus 30% of standard restructured advances remains large at 5.5-5.7% (around Rs. 3.5-3.7 lakh crore as of June 2014) and may continue to impact profitability over the short term. Moreover, ........
RBI curbs banking operations of Choundeshwari Sahakari Bank
The RBI has issued directions to The Choundeshwari Sahakari Bank Ltd of Kolhapur, Maharashtra that will require the bank to seek prior approval for its banking business. “In particular, depositors of the bank will be able to withdraw a sum not exceeding Rs 1,000/- (Rupees one thousand only) of the total balance held in every savings bank or current account or any other deposit account by whatever name called, subject to the conditions stipulated in the RBI Directions,” RBI said in a statement........
Debt and default
..........It remains to be seen if the other banks in the consortium, which has notable names like the State Bank of India, IDBI Bank and Punjab National Bank, will follow suit. Mr. Mallya has tried to shift the blame on to UBI for not following due process before declaring him a “wilful defaulter”, but there is no getting away from the basic fact that Kingfisher has not repaid its loans. It can only be hoped that the process of recovery of dues does not get bogged down in the legal system, given that Mr. Mallya has said he would go to court to contest UBI’s action. Banks are under pressure from the Reserve Bank of India to clean up their balance sheets and go after defaulters. Gross non-performing assets of the banking system at 4 per cent may not be alarming yet, but it is a cause for concern.....
Asking bank to stop cheque payment may land you in jail!
........" Once the cheque is issued by the drawer, a presumption under Section 139 must follow and, merely because the drawer issues a notice to the drawee or to the bank for stoppage of the payment, it will not preclude an action under Section 138 of NI Act by the drawee or the holder of the cheques in due course," the Court held..............
IDBI Bank launches e-lounge in Mumbai branch
.............At IDBI Bank’s e-lounge, banking services that the customers can, on a self-service basis, enjoy are facilities such as ATM, Automated Cash Deposit (with a receipt and instant credit of the amount), Automated Cheque Deposit (with an acknowledgment receipt), Automated Pass Book Printing, e-Transact terminal for various Card and Net Banking holders to view balance, make a funds transfer, pay bills and recharge.........
It’s irrational to oppose what’s better for everyone, Uber says
........"Culturally, we are a very solutions-oriented company. So we are, of course, going to look at all options. However, right now we are having conversations with the Reserve Bank of India (RBI), trying to understand what the rule means for us and how we can just focus on delivering a safe alternative to users," Ryan Graves, head of global operations at Uber, told TOI at the company's headquarters in San Francisco............
Credit Card: Cards up your sleeve
........If one does not get a letter regarding the closure of the credit card account, the bank may charge renewal fees, which will show as unpaid dues even after one has cancelled the card. This will keep getting carried over to the next month, attracting penalty. This will affect one’s credit score in the long run — all the records are shared with various credit information companies. Moreover, if one wants to close multiple credit cards, it is better to do it gradually. Analysts say.......
Radio Taxi industry in talks with RBI
Cashless mode of payments is going to play an important role in India’s radio taxi market and the industry is in discussions with the Reserve Bank of India (RBI) to come out with alternative payment models, a top official said. Siddhartha Pahwa, Chief Executive Officer, Meru Cabs said the industry had given a couple of proposals to the RBI on the alternatives, which includes solutions such as a prepaid wallet and exempting a certain amount of rupee transactions from the two factor authentication...........
Telcos Seek RBI Go-ahead for Arms as Payments Banks
.........The GSM industry body, Cellular Operators Association of India (COAI), has written to the central bank, saying that some of the clauses on promoter equity, foreign equity, rural branches and ring-fencing in the draft guidelines will make it complex and expensive for telecom operators to function as payments banks. It has also asked RBI to do away with the restriction on the maximum deposits per customer and align it with those applicable to any scheduled bank......
Read - TOI
Mobile banking may raise lenders' risks, say experts
.......Security experts say that even though the value in transactions through basic mobiles is not high there will be volume-based vulnerability. The caution comes at a time when the government is planning to extend banking service on basic telephones using the *99# command or USSD (Unstructured Supplementary Service Data)a communication protocol for GSM providers. “When compared to SMS, USSD is considered to be relatively more secure because no copies of messages are stored on customers' phones or at the SMSC. The big risk lies on the fact that data carried within the communication channel (between handset and USSD gateway) is not encrypted,“ .....
Read - TOI
Thursday, September 4, 2014
The governor's year
..........Dr Rajan deserves most credit for his publicly stated resolve not to look at quick-fix solutions, but to focus on correcting the larger structural issues. Given the Indian environment, achieving even a part of that mission before he leaves office would be a considerable achievement.
Raghuram Rajan powerless to back Modi amid inflation risk
......Modi, elected in a landslide win in May, needs to boost investment to aid the economy’s recovery from close to the slowest growth in a decade. Nomura Holdings Inc. and Citigroup Inc. predict Rajan will have to keep the benchmark rate at 8% though the end of 2015 to bring inflation below 6%. The median estimate in a Bloomberg survey is for no cut in the next nine months....
RBI's Khan to head panel on unclaimed funds of PPF
Finance Minister Arun Jaitley has set up a committee under Reserve Bank Deputy Governor H R Khan to take stock of unclaimed deposits in the Public Provident Fund (PPF) and post office saving schemes and suggest how these funds can be utilised for the benefit of senior citizens. The committee will also suggest whether the unclaimed deposits should come to the government or be kept in a separate account. The committee members include........
Financial inclusion makes business sense for banks, says RBI official
.......“Why are foreign investors willing to come into the country in the microfinance segment? This is because they can get returns on their investment. So, the business case has been built up. What we need to build up in financial inclusion is also a similar business case. You do have profit at the bottom of the pyramid,” said Deepali Pant Joshi, Executive Director, Reserve Bank of India, on the sidelines of a recent financial inclusion conclave..........
RBI sets up supervisory college for Axis bank
......P.R. Ravi Mohan, Chief General Manager-in-Charge, Reserve Bank of India, Department of Banking Supervision, presided over the deliberations of the college and gave a presentation about the supervisory role of the Reserve Bank with an insight into the new approach in supervision, that is, Risk Based Supervision. Sudharshan Sen, Chief General Manager in-Charge, Department of Banking Operations and Development gave a presentation on the regulatory set up in the country.
Obituary
Shri. P.R.Palekar passed away in Mumbai on August 14, 2014. He was 86 years old. He joined RBI in 1951 and retired in 1988, thus serving in the Bank for 37 years. For long years he worked in ACD, Garment House and retired from Urban Banks Departnebt. A simple Gandhian, he was always Khadi clad and decided not to get married and also not to opt for promotion. He retired as a Research Assistant. A very popular person he had a wide circle of friends. We pray that his soul rests in peace.
- P.P.Ramachandran
Presaging a turnround?
..........In terms of economic activity, the turnaround in mining and quarrying (2.1 per cent) and manufacturing (3.5 per cent) are particularly impressive as they were in negative territory last year. These sub-sectors along with electricity, gas and water supply, which posted an impressive 10.2 per cent increase have benefited from recent policy decisions and, especially in the case of mining, environmental clearances. There has been a slight decrease in agriculture growth to 3.8 per cent from 4 per cent a year ago. However,....
SUPREME COURT ORDERS RBI TO TRANSFER GREENPEACE FUNDS TO IDBI BANK AC
The Delhi High Court today issued notice to the Ministry of Home Affairs (MHA) seeking its response in a petition filed by Greenpeace India alleging that the government had blocked its foreign funds. The court also directed that Greenpeace India’s blocked funds to be moved from RBI’s account to the NGO’s account with IDBI Bank, Greenpeace said. The money has to be put in a fixed deposit until October 10. The government has to file their response to the HC notice in the next two weeks. The next hearing of the case will be on 10th October.....
RESERVE BANK CONDUCTS CHANDIGARH ROUND OF RBIQ
As part of its continuing initiatives for promoting financial awareness and education, Reserve Bank of India (RBI) Chandigarh conducted RBIQ, an Inter-School Quiz today at the Tagore Theatre, Sector 18, Chandigarh. The main objective of the quiz was to create awareness and interest in the young student community about banking and finance, the history and role of RBI, other banking/ financial institutions, economics, current affairs,......
Customers facing hardships in transactions as banks brace for ATM fee switch
......Retail bank customers using the automated teller machines (ATMs) of banks where they do not have accounts are facing hardships as software glitches in banks' migration towards payment for ATM transactions have led to many machines rejecting the demand for withdrawal, or dispensing less than half of what is sought, increasing the number of transactions.............
Maharashtra’s women coop bank spreads wings
........"At present, MannDeshi Mahila Bank has seven branches at Satara and Pune. The NBFC model will help us begin micro-lending initiatives in other parts of the country and scale up pan India gradually," she explained. "The model for growth has been very simple. Expand branches and, alongside, also open rural business schools for women in the area," Sinha added. Mann Deshi has enabled 1,85,000 women to save, 10,000 to own property and 42,000 to set up businesses and emerge as developers of their local eco-systems. Last year, ...........
RBI stipulates conditions for acquiring UCBs by commercial banks
...The RBI has introduced the above mentioned stipulations to ensure that the process of consolidation by way of non-disruptive exit of weak entities by a scheme of transfer of assets and liabilities of urban co-operative banks (UCBs) to commercial banks is undertaken in a transparent manner..........
Implementation of OTS scheme only after RBI nod: banks
PANAJI: Ahead of the notification of the one-time settlement (OTS) scheme, bankers said that action on the scheme can be taken only after receiving permission from the Reserve Bank of India (RBI). The Goa government, bankers pointed out, is eager to relieve the loan burden of barge owners, truck operators and mining machinery operators through the OTS scheme. But executing the scheme is not a straightforward process and is likely to take time from the bank end, they said. The Reserve Bank of India’s endorsement is crucial for co-operative banks too, said senior officials of state urban banks adding that once it is received, they will also have to seek consent from their shareholders. Co-operative banks have held several meetings with the government on .........
Foreign banks allowed to lend in rupees
..........The Reserve Bank of India (RBI) on Wednesday allowed non-resident foreign banks to offer debt to local companies in Indian rupees. Foreign lenders can extend external commercial borrowings (ECBs) in Indian currency, if they mobilises Indian rupees through swaps undertaken with authorised dealers in India. Ashutosh Khajuria, president, Federal Bank, said, “This will be a competition for domestic banks as foreign banks will not be bound by the reserve requirements of cash reserve ratio (CRR) and Statutory Liquidity Requirement (SLR). So they may be able to lend at cheaper rates.”......
SBI to hire 2,986 probationary officers
........The online registration can be done during September 1 – 18, 2014. The written examination would be conducted tentatively in November 2014. Graduates who are in the age group of 21-30 years are eligible to apply and age relaxation would be extended as per the Government norms..........
Wednesday, September 3, 2014
Raghuram Rajan: The One-Handed Economist
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