BBB recommends 15 names for executive directors appointment in PSU banks (Source: MINT)
- Banks Board Bureau (BBB) has recommended to the government names of 15 general managers of various public sector banks for appointment as executive directors.
- The recommendations were made by BBB chairman Vinod Rai and other members of the bureau. The list would be sent to the Department of Financial Services to get Appointments Committee of Cabinet (ACC) clearance, officials said. The ACC is headed by Prime Minister Narendra Modi.
2. Aadhaar Pay sees 6-fold jump in rural transactions between October and April (Source: ET)
- Aadhaar Enabled Payments Systems (AEPS), promoted by the government to drive digital payments in rural India, is showing definitive signs of adoption amongst its target audience with transactions rising more than six-fold within five months of the currency swap.
- Banks have already deployed around 1.3 lakh micro ATMs in the country, of which more than 1 lakh terminals are interoperable. Mirroring the success of the Unified Payments Interface (UPI), AEPS transactions reached more than 6 million in April against less than a million in October, a month before demonetisation was announced, according to NPCI data.
- From about 2 million in December, the number of transactions has steadily increased to 6.1 million in April. AEPS transactions are driven by microATMs being deployed majorly by banks in rural India, where smartphone based payments cannot work.
3. ATMs to turn costly under GST, small banks to be hit (Source: ET)
- Deploying automatic teller machines (ATMs) is set to get more expensive as ATMs have been put under the highest tax slab of 28% under the new Goods and Services Tax regime. With the machines becoming more expensive, smaller banks and newlylicensed small finance banks could slow down deployment of teller machines, causing further problems for the industry.
- Not only have prices of these machines gone up, even service cost for ATMs will go up as tax rates have been revised to 18% from 15% previously. This would be applicable for servicing charges, annual maintenance contracts which will have to be borne by the banks eventually.
4. PNB to block all Maestro debit cards from July 31 (Source: BL)
- Punjab National Bank (PNB) is going to replace all the Maestro cards with a more secure EMV chip-based card by the end of this month. The replacement is as per RBI advisory issued in 2015, asking all banks to migrate to a much secured EMV chipbased card.
5. Corporate bond market: Liquidity in secondary trade rises (Source: BS)
- The corporate bond market is slowly coming of age, with liquidity in the secondary market on the rise, according to the Financial Stability Report (FSR) published by the Reserve Bank of India (RBI).
- Primary issuance in the corporate bond space rose from Rs 1.74 lakh crore in 2008-09 to Rs 6.7 lakh crore in 2016-17. “Secondary market activitie are also on the rise, with 2016-17 witnessing growth of 26 per cent in a number of trades and 44 per cent in terms of volume (from) the previous year,” it said.
- This is good news for the market and issuers looking to tap it. A bank-dominated market is giving way to a market-based financial system
6. Non-food credit inches up 4.5% in April as industries contract (Source: ET)
- Non-food credit grew at a moderate 4.5 per cent to Rs 6848900 crore in April from Rs 6551500 crore a year ago, pulled down by a 1.4 per cent contraction in industrial credit demand, shows RBI data. In the same period last year, non-food credit had grown by 8.5 per cent
7. GST to boost India GDP growth, credit rating: Moody’s (Source: MINT)
- Implementation of the goods and services tax (GST) will be positive for India’s rating as it will lead to higher gross domestic product (GDP) growth and increased tax revenues, Moody’s Investors Service said.
- Over the medium term, Moody’s expects that the GST will contribute to productivity gains and higher GDP growth by improving the ease of doing business, unifying the national market and enhancing India’s attractiveness as a foreign investment destination.
- The GST will also support higher government revenue generation through improved tax compliance and administration. Both will be positive for India’s credit profile, which is constrained by a relatively low revenue base.
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