Will banks invest in new ATMs ?

Reserve Bank of India feels that cost effective access to ATMs will encourage usage of ATMs and want banks to reduce the Service charges for ATMs and soon phaseout all fees. This is good news for customers.

But in future banks may not be interested in investing in new ATMs. Even maintaining present ATM networks may become unviable for banks. So rationalization & transparency in rates is need of the hour for a increased usage of ATMs, not phasing out of fees.

CSR in Banking

It is high time that India becomes proactive on Sustainable Development. Awareness of terms like Sustainable Development and Corporate Social Responsibility is relatively low in India vis-a-vis the rest of the world. Global warming and climate change are particularly important in the context of sustainable development, especially for developing countries. The role of financial institutions in sustainable development is very crucial as they finance the economic and developmental activities of the world.

Now the RBI has taken initiatives for creating awareness. They have told banks to undertake CSR initiatives for sustainable development. Accordingly, banks are supposed to give an account of their intangible assets (non-financial reports) and place them in public domain. Non-financial reporting is a system of reporting by organisations on their environmental, social and economic accounting activities.

Has RTGS option become popular?

Success of any new product depends on the usage and acceptance from the customers/endusers. Presently success of products like RTGS is seen in volume terms and not by the transaction numbers. Minimum amount of Rs 1 lac , additional charges and lack of awareness of RTGS may be hindering the success of this product.Banknet's Customer Survey on Payment Systems attempts to determine the awareness and acceptance levels of various funds transfer options among the end-users.

An Indian is now top banker

Vikram Pandit, is the youngest person to become the CEO of Citigroup. A master in electrical engineer by degree, Vikram switched to the financial field to make a mark in Morgan Stanley. A year ago, Vikram had founded Old Lane, a hedge fund focused on real estate and infrastructure opportunities in India, right after leaving the top executive position at Morgan Stanley. Citigroup later bought out the company (for a whopping $600 to $800 million) to offer the key people in Old Lane jobs in Citigroup’s Alternatives business. And within six months, Vikram got the CEO’s position at Citigroup. The 50-year old Indian, has certainly made India proud.

Beware of email-frauds

We all get a number of mails asking for help in transferring their millions of dollars to India - showing an opportunity for earning huge commissions. These mails that usually are from Nigeria or other African countries asking for help by using your bank account for the funds transfer. Every week we also win million of dollars in lotteries. Internet servers mark these messages (and we should regard too as) spam.

However, there is a new turn to these mails. Now to show authenticity, they are using the name of India's central bank, the RBI, into the picture. They claim that huge sums of money for disbursal of loans in India at cheap rates have been kept in an account with the Reserve Bank. In these lines, the RBI has 'refuted' these claims and has cautioned the general public against following prey to these fake e-mails.

Other-bank ATM transaction fees got lower

The Institute for Development and research in Banking Technology (IDRBT) recently announced that it has removed the inter-bank ATM switching fees. What this means is that when you transact at an ATM that is not owned by your bank ("other-bank" ATM), your bank saves the two Rupees per transaction it would otherwise had to pay to IDRBT to connect to the other bank's infrastructure. So the direct benefit is to the bank. We can now expect this benefit to pass on to the customer, by way of reducing the inter-bank ATM transaction charges. Also, banks with a smaller ATM network can also join the Switch enjoying lower transaction fees for its customers.

Good news for Bank Customers

The RBI has now decided to intervene in the recovery formula of banks - a system that concerns people who have taken bank loans more than their repayment worries. RBI feels that the system could risk the reputation of the banking sector as a whole. Therefore, banks are now urged to follow prescribed specific considerations, which currently are in the making, while engaging recovery agents.

Post this regulation, if found that recovery agents are harassing customers, Reserve Bank may consider imposing a ban on a bank from engaging recovery agents in a particular area, either jurisdictional or functional, for a limited period; and can also attract penalties against any bank or its Directors/ Officers/ agents in this regard.

While these guidelines are in draft, customers can also give their feedback on the same to RBI.