India is much better placed today to deal with future waves of the pandemic relative to the first wave, RBI deputy governor Michael Patra said.
The total amount of fraud reported by banks showed a drop in 2020-21 - for the first time in eight years - though there is an emerging trend of private sector banks reporting a larger number of frauds related to card and internet banking. According to the latest data released by the Reserve Bank of India, commercial banks reported Rs 1.38 trillion of frauds in 2020-21, as compared to Rs 1.85 trillion in the previous year. The first half of the current fiscal year saw banks reporting frauds worth Rs 36,342 crore.
The future of cryptocurrencies in India appears uncertain but that has not deterred young Indians from embracing the so-called 'fourth industrial revolution' world, where interconnectivity and smart automation, much of it relying on blockchain technology, drive human civilisation. Reserve Bank of India (RBI) Governor Shaktikanta Das has repeatedly warned of macroeconomic instability and even "serious consequences" if cryptocurrencies turn mainstream. The country's monetary authority wants a China-like total ban on crypto, not even allowing these currencies to be treated as investments. Though Parliament's website had listed the Cryptocurrency and Regulation of Official Digital Currency Bill as one seeking a total ban of cryptocurrencies in the country, it was not presented in the Winter Session. India now has the highest number of cryptocurrency investors in the world.
The Indian financial system's asset quality improved despite the pandemic, but it could be due to special dispensations by the regulator, and banks would likely see increased stress on their books once the schemes expire. According to the annual trend and progress report of the Reserve Bank of India (RBI) released on Tuesday, the data available for this financial year so far indicate that banks' bad debts have moderated while provision coverage ratios (PCRs), capital buffers as well as profitability indicators have improved relative to pre-pandemic levels.
Tokenisation is the process of replacing debit and credit card numbers with a set of characters or tokens.
Reserve Bank of India (RBI) deputy governor M Rajeshwar Rao on Wednesday defended the central bank's decision of not allowing industrial houses to float banks, and said more deliberations are needed before RBI changes its stance on this issue agreed back in 2001. An internal working group (IWG) of the RBI had recommended allowing industrial groups into banking, but late last month the RBI said it kept on hold the two recommendations of allowing industrial houses and large non-banks to float banks. However, RBI had accepted 21 of the 33 recommendations of the group that submitted its report a year ago.
The draft amalgamation scheme of Punjab and Maharashtra Co-operative (PMC) Bank with Unity Small Finance Bank (SFB) allowed quick relief to depositors with savings of up to Rs 5 lakh, but a long wait for those who had their nest egg with the scam-tainted bank. If the scheme gets approved, 96 per cent (or 880,000 of 924,000) depositors will get their full money straightaway after PMC is merged with Unity SFB. According to the draft scheme, retail investors may get up to Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC) instantly, and then some more in phases till they can recall their full deposits after 10 years.
The Reserve Bank of India's retail direct scheme is off to a good start but the central bank itself sees it as an additional avenue and not an alternative to the existing one. Still, a reasonable expectation is to have at least 100,000 investors within a month of it being operational, and that could be well under way, if the latest trend is to sustain. The registration in the retail direct platform has crossed 35,000.
'I hope the trend is sustainable and that economic activity accelerates going forward.'
The Reserve Bank of India (RBI) unions have decided to intensify their stir demanding revision of wages, pending since November 2017, and have called for mass casual leave of employees at the central bank on November 30. However, several sources in the RBI told Business Standard that the unions may not have to go on agitation, as the new contours of the wage pact have been almost finalised and could be announced any time. An email sent to the RBI was not answered. The United Forum of Reserve Bank Officers and Employees had deferred its agitation earlier after it was told that RBI Governor Shaktikanta Das was to hold talks with the human resource management department (HRMD).
Rapid strides in digital payments notwithstanding, the Indian economy will likely remain cash-dependent for many years to come, at least that's what the automated teller machine makers and cash logistics companies are betting on. After growing at over 20 per cent for most of 2020, currency in circulation growth fell to 8.5 per cent as of October 29 this year, shows data from the Reserve Bank of India (RBI). The reason for the steep rise in currency last year was the uncertainties related to the Coronavirus (Covid-19) pandemic, where people preferred to hoard cash to meet exigencies.
Prime Minister Narendra Modi will on Friday launch two schemes of the Reserve Bank of India (RBI) that may go a long way in changing how the household sector invests, and complains if anything goes wrong with their savings. These schemes - retail direct and an integrated ombudsman - will be launched by the Prime Minister virtually, in the presence of Finance Minister Nirmala Sitharaman. With the introduction of retail direct, a common man can directly take a position in government securities (G-Sec), considered to be the safest asset class a sovereign can offer.
'Rather than experimenting with CBDCs, we must come up with a very simple and straight design.' 'Dematerialise your currency/cash and with that dematerialised rupee allow all the transactions digitally.'
The Insurance Regulatory Development Authority of India (Irdai), the regulator for insurance companies, is set to allow the insurers to offer wellness programmes along with life insurance policies that can earn reward points for the policyholders. These reward points can be redeemed for getting a discount during renewal. The insurance regulator has circulated draft guidelines to insurance companies for feedback before issuing the final guidelines, as is the norm.
Nearly two million e-mandates for recurring payments have been registered with banks and card networks after the Reserve Bank of India (RBI) made it mandatory from October 1 to take prior consent of a customer before debiting her account, sources in know of the matter said. Industry estimates peg the recurring transactions at approximately 2.5 per cent of the total volume of transactions, and about 1.5 per cent in terms of value. Of these, around 75 per cent of domestic recurring transactions, and about 85 per cent international recurring payments are below Rs 5,000.
A lot depends on how Srei shapes up under the new administrator and his team, which is critical for investors' interest.
'But we are much better than what we all had expected and planned, and what all the prophets of doom had predicted.'
Term insurance policy premiums are set to rise by 25 to 30 per cent with Munich Re, the largest reinsurer for the Indian insurance market, increasing its rates for underwriting portfolios of pure protection plans by up to 40 per cent. According to a senior executive of a private life insurance company, the global reinsurer has communicated its decision about increasing rates. About 8-10 insurance companies have been informed about the move, sources said.
The recent Reserve Bank of India (RBI) norms on tokenisation services, which will be offered by card networks, are likely to result in merchants and payment aggregators incurring a cost as they have to pay a fee to the networks. The merchants and the payment aggregators, in turn, may pass on the cost to the customers. The norms, which were issued by the banking regulator released on September 7, allow card networks like Visa and Mastercard to offer the tokenisation service.
'Even if there is a third wave or a fourth wave, it is hard to see the economy will suffer like that (during the first wave).'
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