The Reserve Bank of India is holding an exhibition, `Foreign Exchange and You', for general public with an aim to educate them about the availability of foreign exchange. The exhibition will be for two days 12 and 13 November in Lucknow.
Regional director, RBI Amrendra Sahu said, "We have found that the level of awareness about foreign exchange and the facilities available to masses is relatively low in Tier-2 cities. After a successful run in Hyderabad, this exhibition is now being organized in Lucknow.''
Deputy governor RBI, Shyamala Gopinath will be attending the two day event and will be participating in a public interface about foreign exchange matters. Besides RBI, public and private sector banks dealing in foreign exchange will be participating in the two day event. Sahu said, "The exercise is a part of RBI's financial literacy program. Earlier, only exporters, importers and corporates were invited to attend. Under the Foreign Exchange Management Act, RBI has offered a large number of relaxations relating to foreign exchange. Though this platform, RBI will be able to disseminate this information to the general public as well.''
During the event key issues which will be addressed include FEMA violations, rules of foreign direct investments in India, foreign exchange facilities available to residents and non-resident Indians, overseas direct investment as well as issues related to fraudulent email and SMS messages are sent offering large sums of foreign exchange. Sahu said, "A large number of cases, where fake RBI letter heads and certificates were used for such fraudulent practices, have come to light. The bank has already issued notifications asking people to be careful of fictitious mails offering money. At the exhibition, people will have the opportunity to have all such doubts clarified.''
Tuesday, November 9, 2010
Monday, November 8, 2010
RBI tells banks to educate customers about e-payment options
In spite of automated teller machines (ATM) and net banking facilities, also new technologies are being adopted by banks to provide better services and facilities to their customers still customers stand in long queues in front of teller counters in banks. The Reserve Bank of India (RBI) has instructed group of top bank executives to promote use of electronic transactions among customers so that long queues can be reduced.
In a meeting with bank executives RBI told executive directors of select state-run banks to provide information to their customers about other options such as real-time gross settlement, national electronic funds transfer, and electronic clearing service, for transactions.
An anonymous bank executive who attended the meeting told, “RBI told banks to improve the penetration of electronic payment systems during a meeting to review the present situation.” Executive directors of Allahabad Bank, Bank of Baroda, Bank of India, Central Bank of India, Dena Bank, Punjab & Sind Bank, Syndicate Bank, UCO Bank and Vijaya Bank were at the meeting presided over by RBI chief general manager G Padmanabhan.
The central bank said though paper-based system will continue to dominate but, banks must try to increase electronic payment options in terms of the value of transactions. While about 90% of all banking transactions are done electronic payment options in terms of value, although in terms of number of transactions the share of electronic payment is just about 35%. Some of the banks are educating their customers and helping them in adopting the electronic options.
From the past few years, RBI has been encouraging banks to adopt electronic payment products that are better to paper-based systems in terms of traceability, efficiency, speed and safety such as RTGS is for high-value transactions, NEFT and ECS are for small amounts.
However the use of paper-based instruments has been reduced both in volume and value terms. According to RBI paper-based solutions will dominate in terms of numbers and has launched a speed-clearing system to streamline the process and reduce the time taken for collection of outstation cheques. Currently speed clearing system is available for MICR (magnetic ink character recognition) cheques at 66 MICR cheque processing centers across the country.
In a meeting with bank executives RBI told executive directors of select state-run banks to provide information to their customers about other options such as real-time gross settlement, national electronic funds transfer, and electronic clearing service, for transactions.
An anonymous bank executive who attended the meeting told, “RBI told banks to improve the penetration of electronic payment systems during a meeting to review the present situation.” Executive directors of Allahabad Bank, Bank of Baroda, Bank of India, Central Bank of India, Dena Bank, Punjab & Sind Bank, Syndicate Bank, UCO Bank and Vijaya Bank were at the meeting presided over by RBI chief general manager G Padmanabhan.
The central bank said though paper-based system will continue to dominate but, banks must try to increase electronic payment options in terms of the value of transactions. While about 90% of all banking transactions are done electronic payment options in terms of value, although in terms of number of transactions the share of electronic payment is just about 35%. Some of the banks are educating their customers and helping them in adopting the electronic options.
From the past few years, RBI has been encouraging banks to adopt electronic payment products that are better to paper-based systems in terms of traceability, efficiency, speed and safety such as RTGS is for high-value transactions, NEFT and ECS are for small amounts.
However the use of paper-based instruments has been reduced both in volume and value terms. According to RBI paper-based solutions will dominate in terms of numbers and has launched a speed-clearing system to streamline the process and reduce the time taken for collection of outstation cheques. Currently speed clearing system is available for MICR (magnetic ink character recognition) cheques at 66 MICR cheque processing centers across the country.
Wednesday, October 27, 2010
RBI mandates folowing KYC norms for banks
The Reserve Bank of India has issued new norms to banks in a bid to keep check on money laundering. RBI has instructed banks apart from getting certification by employer, they should ask for valid documents at the time of opening accounts of salaried employees.
A circular issued by RBI stated to reduce the risk of fraud banks have to rely on certification only from corporate and other entities of repute and so they must have proper information of the competent authority designated by the concerned employer to issue such certificate or letter.
Besides the certification from employer, banks must mandatorily ask for at least one of the officially valid documents as provided in the Prevention of Money Laundering Rules namely passport, driving license, PAN Card, Voter’s Identity card, etc, it said.
The circular stated banks can accept utility bills as valid document for know your customers (KYC) purposes for opening bank account of salaried employees of corporates and other entities.
It said, in case of any violation or non-compliance of the norms by any bank will attract penalties under Banking Regulation Act.
RBI said, it has been noticed that some banks for opening bank account of salaried employees of corporates, rely on certificate or letter issued by the employer as the only KYC document for the purposes of certification of identity as well as address proof.
A circular issued by RBI stated to reduce the risk of fraud banks have to rely on certification only from corporate and other entities of repute and so they must have proper information of the competent authority designated by the concerned employer to issue such certificate or letter.
Besides the certification from employer, banks must mandatorily ask for at least one of the officially valid documents as provided in the Prevention of Money Laundering Rules namely passport, driving license, PAN Card, Voter’s Identity card, etc, it said.
The circular stated banks can accept utility bills as valid document for know your customers (KYC) purposes for opening bank account of salaried employees of corporates and other entities.
It said, in case of any violation or non-compliance of the norms by any bank will attract penalties under Banking Regulation Act.
RBI said, it has been noticed that some banks for opening bank account of salaried employees of corporates, rely on certificate or letter issued by the employer as the only KYC document for the purposes of certification of identity as well as address proof.
Wednesday, October 13, 2010
New Rs 5 and Rs 2 coins to bear CWG logo
The Reserve Bank of India (RBI) will be launching new Rs 5 and Rs 2 coins bearing the 19th Commonwealth Games logo.
The RBI said on the reverse side of both the coins logo will be embossed at the centre, with the words - ‘‘XIX Commonwealth Games, 2010-Delhi” — in English and on the left upper periphery, it will be written in Hindi. Below the logo in international numerals and English the date will be written – “3-14 October 2010”.
As per Indian Coinage Act, 1906 coins are legal tenders. The RBI said, ‘‘The existing Rs 5 and Rs 2 coins in circulation will also continue to be legal tenders.”
The RBI said on the reverse side of both the coins logo will be embossed at the centre, with the words - ‘‘XIX Commonwealth Games, 2010-Delhi” — in English and on the left upper periphery, it will be written in Hindi. Below the logo in international numerals and English the date will be written – “3-14 October 2010”.
As per Indian Coinage Act, 1906 coins are legal tenders. The RBI said, ‘‘The existing Rs 5 and Rs 2 coins in circulation will also continue to be legal tenders.”
Tuesday, September 21, 2010
Reserve Bank of India launches RBI Young Scholars Award Scheme for students
The Reserve Bank of India (RBI) has launched the RBI Young Scholars Award Scheme to develop interest and awareness about the Indian banking sector and RBI. RBI will conduct entrance exam in English, Hindi and 11 other regional languages and will select a maximum of 150 young scholars and award a scholarship.
Selection test will focus on the role and functions of RBI and banks in India. The selected candidates will be placed at the nearest Regional Office designated for the purpose, depending on the size of the office where these candidates will work on projects for 2 to 3 months and will be paid a consolidated stipend of Rs 7,500 per month during the duration of the project. The outstation awardees will be assisted by RBI in boarding and lodging during the program.
All students, between 18 and 23 years of age, who are currently pursing their undergraduate studies in any subject under any recognized university in India, are eligible to take up this competitive examination. The students can apply either online or offline. The prescribed application form is available on http://www.rbi.org.in/youngscholars.aspx. There is no fee for application or examination. For more information, visit www.rbi.org.in.
Selection test will focus on the role and functions of RBI and banks in India. The selected candidates will be placed at the nearest Regional Office designated for the purpose, depending on the size of the office where these candidates will work on projects for 2 to 3 months and will be paid a consolidated stipend of Rs 7,500 per month during the duration of the project. The outstation awardees will be assisted by RBI in boarding and lodging during the program.
All students, between 18 and 23 years of age, who are currently pursing their undergraduate studies in any subject under any recognized university in India, are eligible to take up this competitive examination. The students can apply either online or offline. The prescribed application form is available on http://www.rbi.org.in/youngscholars.aspx. There is no fee for application or examination. For more information, visit www.rbi.org.in.
Friday, September 17, 2010
RBI hiked repo rates, banks to raise home and auto loans by 25-50bps
The Reserve Bank of India’s (RBI) has hiked its key policy rates —repo rate (the rate at which it lends to commercial banks) by 25 basis points (bps) to 6% and reverse repo rate (the rate at which banks park excess cash with RBI) by 50 bps to 5%. As a result in October, consumers will have to pay more on home and auto loans. The bankers will be raising lending rates anywhere between 25 and 50 basis points. One basis point is equal to one hundredth of a percentage.
There is good news for investor’s banks will be increasing deposit rates as the banks have been witnessing sluggish growth in deposits at just about 14%.
SS Ranjan, chief financial officer, State Bank of India, said, “RBI move clearly signals an upward bias on interest rates. We will decide on a possible revision in rates in our asset and liability committee (ALCO) meeting,'' and added, “The quantum of the rate hike will depend on how the cost of funds and demand for credit pans out.''
MV Nair, chairman and managing director, Union Bank of India, said, “We expect credit demand to pick up in October as the busy season kicks in and there will be pressure on liquidity which will lead to rise in interest rates. We will review our base rate and benchmark prime lending rate in October.''
Dipak Gupta, executive director, Kotak Mahindra Bank, pointed out, “Interest rates will move up and we may increase our interest rates both deposits and lending to 25 basis points.''
http://static.expressindia.com/expressindia/newpic/nor.jpgAccording to Ashish Parthasarthy, head (treasury), HDFC Bank, “There is every possibility that base rate will be revised to the extent of 25-50 basis points.'' There would be another round of deposit rate hikes of 25 basis points across the board but not immediately.”
According to Keki Mistry, vice-chairman & CEO, HDFC, increase of 25bps in repo rate will not have any significant impact on long term rates. “Immediately there will be no increase in rates as the market had factored in a 25 basis point hike in repo rate. I expect RBI to now take a pause as inflation is easing,'' said Mistry.
The Housing Finance Company- which is facing tuff competition from public sector bank like State Bank of India- has recently introduce a dual rate home loan product. Under this scheme company is offering a fixed interest rate of 8.50% per annum up to March 31, 2011and of 9.50% for period between April 1, 2011 and March 31, 2012 and consequently the interest of rate of the remaining loan tenure will be at a floating rate.
PC John, executive director, Federal Bank, points out, “Overall interest rates are likely to go up. We may increase our deposit and lending rates to the tune of 25-50 basis points. At the same time, if credit demand does not pick, it would not be feasible to hike interest rates upfront.''
On the other hand RVS Sridhar, president and head, global markets, Axis Bank, said, “We believe any further rise in deposit and lending rates will be limited. Deposit rates already moved up in anticipation of RBI rate hikes in the last 1-2 months. It may not be necessary to hike rates immediately.'' “The question of increasing lending rate comes in when our cost of funds goes up. However, we need to keep watch on industry trends and if needed, would revise interest rates,'' added Sridhar.
MD Mallya, chairman and managing director, Bank of Baroda also confirmed his bank will review the base rate by the end of the quarter.
To control the rising inflation the central bank has raised the policy rates for the fifth time this year in its first mid-quarter review of the monetary policy. The RBI in its press release said, “Inflation remains the dominant concern in macroeconomic management.”
In August the wholesale price base inflation had increased to 8.5% from a year earlier, while in July it was at 9.8%, the commerce ministry told on September 14. The hike in repo rates will result in rise in cost of funds for the banks and in long term the loans become expensive. Bankers are expecting to raise lending rates by 25-50 basis point when the base rate will be reviewed in October.
By the end of August 27, 2010, there was a slip in lending to corporate and individuals by commercial banks. It had slipped little below 20% , the target set by the Reserve Bank of India in 2010-11. However, in August most of the commercial banks had hiked their deposits and lending rates in the range of 25-75 basis points. The banks raised the rates after RBI had hiked the repo rate by 25 basis points to 5.75% and the reverse repo rate by 50 bps to 4.50% on July 27.
There is good news for investor’s banks will be increasing deposit rates as the banks have been witnessing sluggish growth in deposits at just about 14%.
SS Ranjan, chief financial officer, State Bank of India, said, “RBI move clearly signals an upward bias on interest rates. We will decide on a possible revision in rates in our asset and liability committee (ALCO) meeting,'' and added, “The quantum of the rate hike will depend on how the cost of funds and demand for credit pans out.''
MV Nair, chairman and managing director, Union Bank of India, said, “We expect credit demand to pick up in October as the busy season kicks in and there will be pressure on liquidity which will lead to rise in interest rates. We will review our base rate and benchmark prime lending rate in October.''
Dipak Gupta, executive director, Kotak Mahindra Bank, pointed out, “Interest rates will move up and we may increase our interest rates both deposits and lending to 25 basis points.''
http://static.expressindia.com/expressindia/newpic/nor.jpgAccording to Ashish Parthasarthy, head (treasury), HDFC Bank, “There is every possibility that base rate will be revised to the extent of 25-50 basis points.'' There would be another round of deposit rate hikes of 25 basis points across the board but not immediately.”
According to Keki Mistry, vice-chairman & CEO, HDFC, increase of 25bps in repo rate will not have any significant impact on long term rates. “Immediately there will be no increase in rates as the market had factored in a 25 basis point hike in repo rate. I expect RBI to now take a pause as inflation is easing,'' said Mistry.
The Housing Finance Company- which is facing tuff competition from public sector bank like State Bank of India- has recently introduce a dual rate home loan product. Under this scheme company is offering a fixed interest rate of 8.50% per annum up to March 31, 2011and of 9.50% for period between April 1, 2011 and March 31, 2012 and consequently the interest of rate of the remaining loan tenure will be at a floating rate.
PC John, executive director, Federal Bank, points out, “Overall interest rates are likely to go up. We may increase our deposit and lending rates to the tune of 25-50 basis points. At the same time, if credit demand does not pick, it would not be feasible to hike interest rates upfront.''
On the other hand RVS Sridhar, president and head, global markets, Axis Bank, said, “We believe any further rise in deposit and lending rates will be limited. Deposit rates already moved up in anticipation of RBI rate hikes in the last 1-2 months. It may not be necessary to hike rates immediately.'' “The question of increasing lending rate comes in when our cost of funds goes up. However, we need to keep watch on industry trends and if needed, would revise interest rates,'' added Sridhar.
MD Mallya, chairman and managing director, Bank of Baroda also confirmed his bank will review the base rate by the end of the quarter.
To control the rising inflation the central bank has raised the policy rates for the fifth time this year in its first mid-quarter review of the monetary policy. The RBI in its press release said, “Inflation remains the dominant concern in macroeconomic management.”
In August the wholesale price base inflation had increased to 8.5% from a year earlier, while in July it was at 9.8%, the commerce ministry told on September 14. The hike in repo rates will result in rise in cost of funds for the banks and in long term the loans become expensive. Bankers are expecting to raise lending rates by 25-50 basis point when the base rate will be reviewed in October.
By the end of August 27, 2010, there was a slip in lending to corporate and individuals by commercial banks. It had slipped little below 20% , the target set by the Reserve Bank of India in 2010-11. However, in August most of the commercial banks had hiked their deposits and lending rates in the range of 25-75 basis points. The banks raised the rates after RBI had hiked the repo rate by 25 basis points to 5.75% and the reverse repo rate by 50 bps to 4.50% on July 27.
Thursday, September 9, 2010
RBI says, mobile banking to get popular with customers
In October 2008 the Reserve Bank of India had given permission to 18 banks including SBI, ICICI Bank, Bank of India, HDFC Bank, Axis Bank and Union Bank of India, among others to offer mobile banking to their customers in the country. According to apex bank reports after two years the average number of monthly intra-bank transactions has remained extremely low at just 4 lakh among all 18 banks.
Speaking in a banking summit, organized by Indian Bankers’ Association (IBA) and FICCI, KC Chakrabarty said the mobile banking still have to pick up with customers, as most of them are wary of mobile banking.
Chakrabarty said, “As on date, only four lakh intra-bank mobile transactions are happening on an average every month.” He informed out of the four lakh transactions carried out through mobile banking every month, three lakh is done by one bank. He further said in some banks average transactions via mobile banking is as low as 2 per month.
As industry expert informed that mostly small ticket transactions such as postpaid bill payment, credit card bill payment and prepaid mobile refill are done through mobile banking. An anonymous official told, “The average ticket size of such transactions is Rs 230-250.”
Chakrabarty said, “The average cost of banking has not come down and, hence, it is a chicken and egg situation where we can’t get volumes till cost comes down and cost will not come down till volumes are achieved.” AP Hota, chief executive officer of National Payment Corporation of India (NPCI), told the national payment gateway provider is doing pilot project on inter bank mobile banking platform with banks. Hota said, “We are doing the pilot with four banks, namely SBI, ICICI Bank, Bank of India and Union Bank of India. Once three more banks — Axis Bank, HDFC Bank and Yes Bank — get RBI nod, we will launch this platform in October officially.”
Speaking in a banking summit, organized by Indian Bankers’ Association (IBA) and FICCI, KC Chakrabarty said the mobile banking still have to pick up with customers, as most of them are wary of mobile banking.
Chakrabarty said, “As on date, only four lakh intra-bank mobile transactions are happening on an average every month.” He informed out of the four lakh transactions carried out through mobile banking every month, three lakh is done by one bank. He further said in some banks average transactions via mobile banking is as low as 2 per month.
As industry expert informed that mostly small ticket transactions such as postpaid bill payment, credit card bill payment and prepaid mobile refill are done through mobile banking. An anonymous official told, “The average ticket size of such transactions is Rs 230-250.”
Chakrabarty said, “The average cost of banking has not come down and, hence, it is a chicken and egg situation where we can’t get volumes till cost comes down and cost will not come down till volumes are achieved.” AP Hota, chief executive officer of National Payment Corporation of India (NPCI), told the national payment gateway provider is doing pilot project on inter bank mobile banking platform with banks. Hota said, “We are doing the pilot with four banks, namely SBI, ICICI Bank, Bank of India and Union Bank of India. Once three more banks — Axis Bank, HDFC Bank and Yes Bank — get RBI nod, we will launch this platform in October officially.”
Subscribe to:
Posts (Atom)