Lenders in India have requested the Reserve Bank of India (RBI) to double the housing loan amount considered as priority sector lending. Currently, a housing loan of ₹35 lakh in a metropolitan city is considered priority sector lending. The lenders argue that this amount does not reflect the current real estate prices, which have increased since the limits were set in 2018.
"Drumroll please! UPI has just shattered records with an astonishing 10 billion plus transactions. Join us in celebrating this incredible milestone and the power of digital payments. Let's keep the momentum going and continue to revolutionize the way we make transactions with UPI!." NPCI, which run the payment system, said on social media platform 'X', formerly known as Twitter.
Max Financial Services on Thursday issued a clarification on share sale transactions involving Axis Bank and Max Life Insurance Company Limited (‘Max Life’). The company dismissed reports of violation of norms in the Axis-Max Life deal, as reported by CNBC TV18 on August 31, 2023.
Piramal Enterprises plans to double its loan book by FY28, with a focus on retail loans, according to Chairman Ajay Piramal. The company aims to reduce the size of its wholesale book and lend to mid-sized corporates while exiting its legacy wholesale book. The new loan book will be more granular, with smaller loan sizes and a focus on interest and regular repayments.
Finance Minister Nirmala Sitharaman has urged Regional Rural Banks (RRBs) to eliminate duplicate accounts under the Pradhan Mantri Jan Dhan Yojana (PMJDY) and focus on increasing penetration of the Pradhan Mantri MUDRA Yojana (PMMY). Additionally, the finance minister called for the mapping of RRBs with MSME clusters and the expansion of rural branches in these areas.
The Reserve Bank of India (RBI) has urged the directors of Urban Co-operative banks (UCBs) to enhance governance practices to ensure stability. RBI governor Shaktikanta Das highlighted the importance of a professional Board of Management and emphasised the need to strengthen compliance, risk management, and internal audit. He also called for proactive asset liability management and improved liquidity risk management.
In its appeal, Torrent Investment said the matter is pending with the Supreme Court and if the tribunal approves IIHL's Rs 9,650 crore resolution plan it will become infructuous if the apex court rules against the Committee of Creditors (CoC) decision on the extended challenge mechanism. However, the counsel for the administrator said, the apex court did not stay the proceedings on NCLAT's order on the extended challenge mechanism.
Credit costs for unsecured loans could make up between 60% to 70% of the total provisions for large private sector banks in fiscal 2025 after a strong 26% growth in this segment the last five years. Unsecured loans contribute about 6% of overall system (incl. NBFCs), and contribute 11% for the banking system up from 8% in fiscal 2019.
The average time for resolution under the Insolvency & Bankruptcy Code (IBC) in India has reached a three-year high, according to India Ratings & Research (Ind-Ra). Data from the Insolvency and Bankruptcy Board of India (IBBI) shows that the average time for a corporate insolvency resolution process (CIRP) has increased to 635 days for operational creditors and 643 days for financial creditors, exceeding the 270-day limit set by law.
Mukesh Ambani's Reliance Industries is in talks with global and domestic executive head hunters as it looks to hire a CEO for its newly listed Jio Financial Services' insurance business. Reports say that the company will hire a leader for the insurance wing of the company before early next year.
Standard Chartered is improving its paternity and adoption leave benefits, allowing parents to share caregiving responsibilities more equitably. Starting from September 2023, employees will be able to take up to 20 weeks of paid leave, regardless of gender or relationship status. The move aims to foster an inclusive culture and support working parents. Maternity benefits in India will remain at 26 weeks to comply with statutory requirements. The bank believes that these progressive benefits can help address traditional gender roles and improve workforce participation.
The bad bank, officially known as National Asset Reconstruction Company of India (NARCL), was set up a year ago to acquire the sticky loans of high-street banks. There was a proposal to merge NARCL with India Debt Resolution Company Ltd (IDRCL), which led to Sekar's resignation.
The High Court of Karnataka has stated that compensation claims in road accidents do not need to be proved like criminal trials. The court dismissed an appeal by an insurance company challenging the compensation awarded to the family of an accident victim. The court emphasized that claimants do not have to prove their case beyond reasonable doubt, but rather on the basis of preponderance of probabilities. The court also upheld the compensation awarded by the Motor Accidents Claims Tribunal and rejected the appeal for enhancement.
Axis Bank has launched a paid savings account called the 'Infinity Savings Account', targeting digitally savvy customers. The account does not require a minimum balance and offers free debit cards, domestic transactional fee waivers, and no charges on cheque book usage or transactions/withdrawals above limits.
L&T Finance Holdings is said to be creating the position of a chief marketing officer (CMO) who would report directly to the chief executive officer to push its retail business. The Larsen & Troubro non-banking subsidiary is looking to grow its retail book by about 25 per cent this year to Rs 80000 crore by the end of March 2024.
The acceleration in the issuance of CDs — which are short-term debt instruments used by banks to raise funds —— comes after the RBI imposed an incremental Cash Reserve Ratio (ICRR) of 10% on the growth in bank deposits from May 19 to July 28.
Microfinance Institutions (MFIs) have recouped from the pandemic and have clawed back market share leadership from banks. They closed FY23 with a 40 per cent market share, 600 basis points higher than the previous year while banks saw their share declining to 34 per cent from 40 per cent in FY22. Icra Ratings, in a report on Monday, said MFIs are likely to report a growth of 24-26 per cent in loan sales this fiscal and 23-25 per cent in FY25 when they are also likely to see a further spurt in profitability to 3.2-3.5 per cent.
Jio Financial Services will enter the insurance sector, said Mukesh Ambani at Reliance's 46th annual general meeting (AGM) on Monday. JFS plans to democratise financial services for 1.42 billion Indians, giving them access to simple, affordable, innovative, and intuitive products and services, he said.
A study by the Indian Institute of Management, Ahmedabad, has found that businesses that have gone through the insolvency process experience significant improvements in their business metrics. However, the new owners of these businesses face challenges when dealing with tax officials, banks, and the RBI. Banks often refuse to remove the "defaulter" tag, making it difficult for these businesses to acquire loans.
Finance Minister Nirmala Sitharaman on Monday said Jan Dhan Yojana-led interventions and digital transformation have revolutionised financial inclusion in the country, as more than 50 crore people have been brought into the formal banking system with cumulative deposits surpassing Rs 2 lakh crore.
Banks in India will no longer be able to secretly auction off stressed loans under a new framework agreed upon by high-street banks. The decision to auction loans must now be notified to all key players in the market, ending the practice of keeping potential bidders in the dark. Banks have also established a timeline to close such deals within seven working days after receiving final approval from lending banks.
The recovery rate is considered good given that these loans were overdue by around 60 days. "The recovery was good as the loan accounts were tagged in stage 2 and chances of recovery are strong," said a source. Non-banking finance companies (NBFCs) categorise loans as stage 2 if the overdue period is between 30 and 60 days. Classification of borrower accounts occurs during the day-end process for the specified date.
The Indian government has called a meeting to discuss the implementation of the PM Vishwakarma scheme, which aims to support traditional artisans and craftspeople. The scheme, to be launched on September 17, will provide training and loans to skilled workers, with a target of enrolling 3 lakh beneficiaries in the current fiscal year.
The four public sector general insurance companies are unlikely to get capital funding from the government in the current fiscal, a senior official said. He said one of the PSU non-life insurance companies is likely to give a dividend to the government in the current fiscal and they will be able to meet their solvency margins.
The Indian government is considering extending the retirement age of managing directors and CEOs of public sector banks by two years. Currently, the retirement age for heads of public sector banks, except for the SBI, is 60 years, but this could be increased to 62. The retirement age for the SBI chairman may also increase to 65 from 63.
State Bank of India Chairman Dinesh Khara is likely to get an extension as the government is considering relaxing the retirement age of chiefs of all public sector banks and LIC. The proposal before the government also includes hiking the retirement age limit of managing directors of public sector banks (PSBs) to 62 years, from the current 60 years, a senior government official said on Saturday.
There is strong interest among family offices and high net worth individuals to invest in private credit funds, said the report. This seems to be a rising trend and may become a large source of capital to fuel India’s private credit growth story, it said.
Private sector Karur Vysya Bank has inaugurated 10 new branches in the Southern region. The bank has inaugurated six new branches in Tamil Nadu, two in Andhra Pradesh and one each in Telangana and Karnataka respectively.
“If you look at it in our country, I think it's a lesson for all of the globe on how the payment system could be so efficient, cheap and economical,” Khara said in an exclusive interview with ET on the sidelines of B20 Summit organized by CII in New Delhi.
The clarification comes in the wake of Torrent moving an intervention application before the tribunal asking it to keep IIH’s resolution plan in “abeyance” and to restrain the lenders from declaring IIH as the successful resolution applicant till the Supreme Court decided its appeal.
Authum Investment & Infrastructure acquired assets of both finance companies in an out-of-court resolution process. Under the resolution plan, Authum acquired Rs 11,540-crore debt of Reliance Home Finance for Rs 3,351 crore and the Rs 9,000-crore loan book of Reliance Commercial for Rs 1,629 crore.
DBS and commodities trader Maptrasco have completed the first live transaction of electronic Bills of Lading (eBL) for shipments between Singapore and India. The transaction was carried out under the TradeTrust framework, supported by the Infocomm Media Development Authority and Enterprise Singapore. The project aims to drive cross-border document and title exchanges and improve the efficiency of trade financing.
Reliance Industries Limited will hold its annual general meeting (AGM) on August 28, where Chairman Mukesh Ambani is expected to make key announcements regarding the company's growth and expansion plans. The focus will be on Jio Financial Services (JFS), which recently listed on the stock exchanges. Ambani is likely to share growth plans for JFS, including its entry into the B2B credit business and expansion into insurance, payments, digital broking, and asset management.
Gujarat-based Torrent Investments had emerged as the highest bidder with its Rs 8,640 crore in the initial bidding, but a day later the Hinduja Group through IndusInd International submitted a revised bid of Rs 9,000 crore and the same was approved by the lenders in April. Torrent’s appeal against the IndusInd’s RP is pending before the SC.
A task force in India has recommended that micro, small, and medium enterprises (MSMEs) be given access to sustainable finance to support their digital transformation. The task force also suggested harmonising cybersecurity frameworks across G20 countries to promote digital trust. Additionally, they recommended developing a global minimum standard for digital literacy to drive inclusivity and allow for international skills portability. The task force believes that these measures will enable MSMEs to invest in digital transformation and create a globally recognised and sector-specific platform.
Bandhan Bank is expanding its presence beyond the eastern region of India by building a corporate office in Mumbai and setting up a zonal office and government business centre in New Delhi. The bank has spent around ₹160 crore to purchase commercial space in Mumbai's Bandra Kurla Complex for its corporate centre.
IRDAI has simplified the format of the reinsurance program and brought in tandem the regulations for Indian insurers, Indian reinsurers, Foreign Reinsurance Branches (FRBs), and International Financial Services Centre Insurance Offices (IIOs) to position India as a global reinsurance hub.
A report by GetVantage and Redseer Strategy Consultants highlights a potential credit deficit of $220 billion, hindering the growth of digitized businesses in India. The report estimates that only $165 billion is serviceable, leaving a working capital deficit of $112 billion. With the number of digital SMEs expected to double in the next five years, the demand for credit is projected to exceed $570 billion. Small businesses struggle to raise capital due to poor business metrics and limited assets.
Speaking at the foundation day celebration of Bandhan Bank, Mistry said the housing sector also generates huge employment and has a better credit risk profile than other segments. "Housing holds the key to unlock the potential of the economy. I am optimistic about the demand for housing in India. It also generates huge employment," Mistry, vice-chairman and CEO of erstwhile HDFC said.
Ghosh said the bank, which started its journey eight years ago, has 6,100 banking outlets across 35 states and Union Territories at present. It opened a branch in Leh on Tuesday, and will open another branch at Kargil in September, he said.
In December 2022, the Competition Commission of India (CCI) received a notice jointly given by Platinum Trust, acting through Platinum Trustee, and TPG Upswing in relation to the combination. The regulator noted that the UPL SAS acquisition has been consummated on or before February 17 2023, as the notifying parties (ADIA and TPG) gave the notice under the facility of green channel approval.
On the back of recovery after being hit hard during the pandemic when collections and disbursals plunged, MFIs have clawed back from 32 per cent share in FY20, which declined further to 31 per cent in FY21 before improving to 35 per cent in FY22.
Presently, the Reserve Bank of India's regulations bar payments banks from using their own funds for lending, but do not restrict them from selling other banks' products. These banks are allowed to hold deposits of up to 200,000 rupees, in an account, but much of this has to be invested in government securities.
The Central Bureau of Investigation has registered two separate cases against Mumbai-based Varun Industries Ltd for allegedly defrauding two public sector banks for an amount to the tune of Rs 388.17 crore. The allegations in the complaint revealed that the accused company had availed various credit facilities from the Central Bank of India in a consortium led by Indian Bank, with a total sanctioned working capital-term loan limit of Rs 292.15 crore in September 2011.
The rate of recovery for creditors from the resolution of large stressed firms has exceeded realisation from smaller ones under the Insolvency and Bankruptcy Code (IBC), according to latest data compiled by the regulator.
