Mottos for Success-269
“It is not just enough that each individual in the team is performing fine, but the individual performance should contribute to the Team’s Goals, for the Team to be successful.”
1. NBFCs promoted by a foreign bank having presence in India which is a subsidiary of the foreign bank's parent or group having management control would be treated as part of that foreign bank's operations and brought under the ambit of consolidated supervision.
2. HDFC Bank is on an expansion spree in Himachal Pradesh. It opened the Mandi branch the fifth in the state. It would open its sixth branch in Himachal in the industrial town of Baddi. . the total number of branches would go up to 545 across the country. The private bank entered Himachal Pradesh some three years ago.
3. Considering the problems faced by the rural people in getting adequate finance at a reasonable rate in a transparent manner there are two options. Following the international experience, banks in India need to, one, develop more customised as well as flexible loan products specifically catering to the needs of this sector, and, two, develop new delivery channels for lending to the informal sector directly and indirectly. Banks can appoint some business correspondent agencies, such as NBFCs, reputed NGOs, MFIs and cooperatives, for this. These intermediaries can identify and disburse of small loans in the rural areas for farming or personal purposes. As these business correspondents are basically from the local areas, they can be expected to be more aware about the activities and have other relevant information of their borrowers than any bank officer. By this can be addressed the uncertainties about the quality of borrowers and of the assets. This will help banks in risk mitigation, as a bank's risk will be exposed to the business correspondents only. With proper selection of these business correspondents this risk can also be reduced significantly. Without opening a full-fledged branch in the rural areas, banks can increase their business through this approach, which reduces the cost of operations. Simultaneously, considering the risk factors of lending to this sector, banks can charge comparatively higher interest rates and earn higher returns. Thus, bank finance to this informal sector through the above route is a win-win situation for both banks as well as the rural economy.
4. After having brought in a bunch of measures towards capital account convertibility, the RBI is working on the next set. Among the `measures under assessment' are payment of interest on funds kept by exporters in the Export Earners' Foreign Currency (EEFC) accounts, allowing foreigners to park funds in foreign currency accounts in India and to invest in Indian stock markets, allowing foreign entities to raise funds through rupee bonds and revamping of short term suppliers' credit.
5. Allahabad Bank has secured the approval of its board of directors to come out with a `reverse mortgage' product. Reverse mortage is a scheme meant for elderly people, where the lender would pay a monthly sum to the borrower against the security of a house. Allahabad Bank's scheme could well be the first from a public sector bank.
6. The interest on special deposit accounts for the calendar year 2006 will remain unchanged at 8%. RBI has also asked the banks to ensure disbursement of interest for 2006 in the first week of January 2007.
“It is not just enough that each individual in the team is performing fine, but the individual performance should contribute to the Team’s Goals, for the Team to be successful.”
1. NBFCs promoted by a foreign bank having presence in India which is a subsidiary of the foreign bank's parent or group having management control would be treated as part of that foreign bank's operations and brought under the ambit of consolidated supervision.
2. HDFC Bank is on an expansion spree in Himachal Pradesh. It opened the Mandi branch the fifth in the state. It would open its sixth branch in Himachal in the industrial town of Baddi. . the total number of branches would go up to 545 across the country. The private bank entered Himachal Pradesh some three years ago.
3. Considering the problems faced by the rural people in getting adequate finance at a reasonable rate in a transparent manner there are two options. Following the international experience, banks in India need to, one, develop more customised as well as flexible loan products specifically catering to the needs of this sector, and, two, develop new delivery channels for lending to the informal sector directly and indirectly. Banks can appoint some business correspondent agencies, such as NBFCs, reputed NGOs, MFIs and cooperatives, for this. These intermediaries can identify and disburse of small loans in the rural areas for farming or personal purposes. As these business correspondents are basically from the local areas, they can be expected to be more aware about the activities and have other relevant information of their borrowers than any bank officer. By this can be addressed the uncertainties about the quality of borrowers and of the assets. This will help banks in risk mitigation, as a bank's risk will be exposed to the business correspondents only. With proper selection of these business correspondents this risk can also be reduced significantly. Without opening a full-fledged branch in the rural areas, banks can increase their business through this approach, which reduces the cost of operations. Simultaneously, considering the risk factors of lending to this sector, banks can charge comparatively higher interest rates and earn higher returns. Thus, bank finance to this informal sector through the above route is a win-win situation for both banks as well as the rural economy.
4. After having brought in a bunch of measures towards capital account convertibility, the RBI is working on the next set. Among the `measures under assessment' are payment of interest on funds kept by exporters in the Export Earners' Foreign Currency (EEFC) accounts, allowing foreigners to park funds in foreign currency accounts in India and to invest in Indian stock markets, allowing foreign entities to raise funds through rupee bonds and revamping of short term suppliers' credit.
5. Allahabad Bank has secured the approval of its board of directors to come out with a `reverse mortgage' product. Reverse mortage is a scheme meant for elderly people, where the lender would pay a monthly sum to the borrower against the security of a house. Allahabad Bank's scheme could well be the first from a public sector bank.
6. The interest on special deposit accounts for the calendar year 2006 will remain unchanged at 8%. RBI has also asked the banks to ensure disbursement of interest for 2006 in the first week of January 2007.
