WEEKLY FINANCIAL SNIPPETS- 12/08/2017

1. AADHAAR MAY BECOME MANDATORY FOR FINANCIAL MARKET: Aadhaar number may soon become mandatory for buying shares and mutual funds. The government and SEBI are planning to link Aadhaar to financial market transactions which will help the government to plug taxes and curb black money. The government has already mandated that Aadhaar be linked to PAN, Bank Account and Mobile phone numbers.

2. GOVERNMENT TO INITIATE BANK MERGERS AFTER QUARTER-1 RESULTS: The Finance Ministry is expected to initiate the process of consolidation of public sector banks once the first quarter financial results of the current fiscal have been announced. There are factors like regional balance, geographical reach, financial burden and smooth human resource transition that are to be considered before taking the final decision.This is going to be a complex exercise for the Finance Ministry.

3. OVER 11.44 LAKH PAN CARDS DEACTIVATED: As per the rules it is “ One Person One PAN” which is the guiding principle for allotment of PAN. More than 11.44 lakh Permanent Account Numbers (PAN) have been deleted or de-activated in cases where multiple PANs were allotted to one person.

4. RBI INSTRUCTS BANKS TO ENSURE SAFETY OF CUSTOMERS’ LOCKERS: The Reserve Bank of India has asked banks to ensure customers’ lockers remain safe and there is no negligence that could render banks liable to claims by locker holders. The banks have been advised by RBI that it would be the responsibility of the banks to ensure safety of lockers and there is no negligence in the matter of safeguarding the lockers.

5. MERGER OF SMALL BANKS MAY HURT MSME SECTOR: Merger of smaller banks into big will hurt credit sourcing for MSMEs (Micro,Small& Medium Enterprises). The large banks will be reluctant to lend to these MSMEs as they are less keen on small sized loans. Their services will be less personalised and there will be more fees attached. This is as per the report from financial services firm- Resurgent India.   MSME sector, which provides bulk of employment, accounts for 45% of India’s manufacturing, and nearly 8% of the country’s GDP.

6. RBI TELLS BANKS TO GO FOR PERIODIC VULNERABILITY TEST FOR CYBER SECURITY: Cyber security preparedness is a continuous process and the RBI has asked banks to periodically conduct vulnerability test. This is the result of the recent cyber-attacks and as India is gearing up for cashless economy, the cyber security plays an important role.

7. MONEY FLOW INTO FINANCIAL MARKETS INCREASED, POST DEMONETIZATION: Post demonetization, there has been visible channelizing of money towards financial assets like mutual funds, capital market and insurance. This was observed and stated by Mr.Viral Acharya, Deputy Governor of RBI. Mr. Acharya in his observations said that something has changed as black money transactions are not easy now and the money is flowing towards financial market, which is a positive sign.

8. AHEAD OF FESTIVE SEASON, ICICI BANK INTRODUCES INSTANT CREDIT CARD: Considering the demand due to the forthcoming festive season, ICICI Bank has introduced an instant credit card which can be availed online by its customers and start shopping on e-commerce sites even before the card is delivered to him/her.

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