Bharti Airtel to launch pan-India Payments Bank tomorrow

Bharti Airtel, India’s largest telecom company, will take a crucial step towards entering the financial services business as it launches its Payments Bank operation across India tomorrow. Payments Bank refers to a limited operations bank that can be primarily used for making transactions, and not for depositing money. The operator has already started operations of its payments bank in states like Rajasthan on a pilot basis. In such places, the customer’s Airtel mobile number will be his or her bank account number. It is also offering an interest rate of…

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PayTM adds support for UPI payments

Customers of PayTM, India’s largest wallet service can now make payments using the Unified Payments Interface, the government of India’s open payments platform. The company has signed up with ICICI Bank be able to receive payments from its customers who are on the UPI platform using its ID ‘paytm@icici’. However, customers cannot simply transfer the money to the above ID and expect to see it in their wallet, as it has not mapped all its wallet IDs with their UPI addresses. In other words, if a customer ‘rajesh@sbi’ sends Rs 100 to ‘paytm@icici’, the…

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After Freecharge, Axis Bank wins virtual POS provider Paynear for its UPI platform

Paynear, which helps shopkeepers and businesses to accept card payments without buying a point-of-sale (POS) machine, has tied up with Axis Bank to implement support for UPI or Unified Payment Interface. UPI allows users to send and receive money and make payments using IDs that resemble email addresses (for example, rajesh@icici). Paynear is an Indian startup that is most notable for allowing shops and businesses to accept card payments using its mobile app and no POS machine. The company also has a miniature POS machine for those who are interested…

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Demonetization: RBI removes ‘explanation’ requirement for KYC accounts

The Reserve Bank of India has responded to widespread criticism of its directive to collect ‘explanations’ from those depositing more than Rs 5000 by clarifying that this directive will not apply to bank accounts with proper documentation. “On a review of the above, we advise that the provisions of the above circular at sub para (i) and (ii) will not apply to fully KYC compliant accounts,” it said. The move comes after people expressed displeasure over the earlier rule that required them to furnish an ‘explanation’ in front of the…

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Freecharge ties up with ICICI Bank to offer POS services

Snapdeal-owned FreeCharge has tied up with ICICI Bank’s Merchant Services, which will allow consumers to pay their bill at over 1 Lakh ICICI stores with their Freecharge accounts. These merchants are located at across 700 cities and towns in India, the company said. “FreeCharge’s partnership with ICICI Merchant Services, powered by First Data, will ease the payment process for merchants and consumers by introducing a swifter and secure way to make cashless payments.” It was not specified as to how the tie-up will ease payment, but Freecharge said it involved…

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Petrol Pumps, Airlines Will Not Take Old Notes From Saturday | DEMONETIZATION

Old notes will no longer be accepted at petrol pumps and airline ticket counters starting from Saturday, according to sources. So far, petrol pumps and airlines had been given an exemption from demonetization of 500 and 1000 rupee notes. However, in an effort to control the widespread ‘whitening’ of black money, the government is gearing up to plug any remaining loopholes for criminal elements. With this, only mobile recharge shops and some state governments will continue to accept old notes for payments. WIDESPREAD MISUSE Despite the government’s best efforts, a…

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Fitch revises US growth estimates on Trump election, says protectionism to rise

The surge in populism and anti-establishment sentiment witnessed in the Brexit vote and Donald Trump’s victory in the US presidential election seem likely to push structural policies in the direction of economic nationalism, said Fitch Ratings in its latest global economic outlook (GEO). This will result in a reduction in trade openness and international labour migration. At the same time, electoral expressions of discontent are pushing leaders in the advanced economies to embrace easier fiscal policies, it added. “In the long term, there is little doubt that increased trade protectionism…

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7 ILLOGICAL REASONS to oppose DEMONETIZATION

The current demonetization move by the Narendra Modi government has seen a lot of accusations and counter-accusations being levelled by both the supporters and opponents of the move. While the government has tried to deal head on with the official accusations levelled by opposition political parties, a much more subtle misinformation campaign is going on on social media platforms like WhatsApp and Facebook against the campaign. Such campaigns are started and fanned by people who stand to lose from the current crack down on illicit funds — such as corrupt…

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DEMONETIZATION: How some earned lakhs standing in queues

The government has banned over-the-counter exchange of old 500- and 1000-rupee notes due to suspected gaming of the system by those with black money. According to banking industry sources, the over-the-counter exchange system was being massively misused by hawala operators and others who had illegal funds to convert their old currency into new notes. “The system was so sophisticated that people who had 10 or 20 lakhs of black money could get it converted within one or two days,” said a bank manager. MANIPULATION The modus operandi was simple. A single…

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Despite Demonetization, India will beat China in GDP growth: Fitch Ratings

Despite a moderation in India’s GDP growth rate in the short term due to cash crunch, the Indian economy will still grow faster than that of China, global ratings agency Fitch said. “We still expect India’s GDP growth to trend higher than China’s in the medium term,” said the agency, whose primary job is to advice bond buyers on risks involved in buying debt from countries and corporations. It said India will see a slight decline in GDP growth rate in the year ending March 2017, but will bounce back…

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Airtel starts Payments Bank; offers 7.25% interest on savings ac

Airtel Payments Bank, a subsidiary of Bharti Airtel Limited, today said that it has rolled out a pilot of its banking services in Rajasthan. The pilot is aimed at testing systems and processes ahead of a full scale pan Indian launch. With this, Airtel Bank has become the first payments bank in the country to go live. Payments banks are similar to regular banks, except that they are to be used for making transactions only and not for giving loans etc.. The customer’s Airtel mobile number will be his or…

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ICICI Bank is the first with UPI app for merchants

While nearly all the major banks with the exception of SBI and HDFC have come up with UPI apps for regular users, ICICI Bank has gone a step further by bringing out an app specially dedicated to merchants. The app requires a current account with ICICI Bank to operate, and any small merchant or shopkeeper can use it as a payment option to deal with the ongoing demonetization problems. Compared to getting a swiping (or POS) machine, this solution is almost costless. It is not clear if there is also…

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Fitch says demonetization gains may not last

Fitch Ratings said the positive effects are unlikely to be strong and sufficiently enduring “to support credit profiles” and will impact GDP growth in the current quarter. Though the gains will be substantial in the short-term, they may not last as people may still go back to their old ways after a while. It said the move has the potential to raise government revenue and encourage bank lending. “India’s sovereign credit profile would benefit from an improvement in government finances, which currently stand out as a major weakness. However, there…

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No Income Tax on FCCB proceeds, SC rules on RCom

The Supreme Court on Monday dismissed the petition filed by the Income-Tax Department against Reliance Communications on taxing of the proceeds of Foreign Currency Convertible Bonds (FCCBs), said the telecom operator. The Supreme Court order has quashed contingent tax liability of RCOM for about Rs 4,800 crore. During Financial Year 2006-07, Reliance Communications had issued FCCBs, as per the extant Guidelines of the Reserve Bank of India and applicable laws, aggregating US $1.5 billion, which amounted to around Rs 6,485 crore at the time. FCCB refers to money raised by…

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Card payments slow as people start swiping more after Demonetization

Swiping a debit or credit card at the local grocery store or supermarket is supposed to be the best way to beat the demonetization blues, but going by social media feedback, these networks are getting overloaded as well. In fact, our own staff have found that they have had to swipe their cards 3 or 4 times for the transaction to go through. Sometimes, it doesn’t go through at all — especially in smaller shops which have only one point-of-sale or swiping machine. “It took me 10 minutes to complete…

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Modi Govt to give ‘cashback’ on black money destroyed?

He may not be able to deliver the Rs 15 lakhs, but according to a media report, Narendra Modi’s government is thinking of transferring at least part of the black money destroyed through demonetization to Jan Dhan account holders. Jan Dhan accounts were opened in 2014 by economically weaker sections of the population who did not have any bank accounts at the time. However, many of the Jan Dhan accounts, which did not have any balance in them, have seen deposits of up to Rs 49,000 in the last one…

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SBI starts accepting UPI payments

State Bank of India, India’s largest bank, has started accepting UPI payments from customers of other banks. However, outgoing payments are yet to be enabled from an SBI account to other accounts. UPI refers to a new way of making instant payments. Instead of entering details such as bank account number and IFSC code, Unified Payments Interface requires only a small identifier similar to an email address. For example, a person can have an ID like ‘sanjay@sbi’. With this ID, he can send and receive money from any other person and…

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No Note Exchange, only Account Withdrawals Tomorrow as banks take a breather

There will no over the counter exchange of currency tomorrow (Saturday) as banks have requested for a one-day break from the heavy workload. The only exception will be for senior citizens. Deposits and withdrawals will continue. “The entire staff of the banks have been dedicated to this for several days. Our own customers have been suffering,” Rajeev Rishi, chairman of the Indian Banks Association said. This follows 10-days of continuous efforts by lakhs of bank employees across India to get new currency notes into the hands of the people. The…

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RBI chests have enough cash – ICICI Bank CEO

ICICI Bank Chief Executive Officer Chanda Kocchar today said the Reserve Bank of India’s currency chests have enough cash and there is no situation of scarcity for banks in securing notes. Kocchar also said that all banks including hers are bringing more and more ATMs into working mode after a change in currency put most of them out of function. “These ATMs are not disfunctional. They have to be recalibrated and all banks, under the supervision of the RBI are doing so,” she said. Kochhar did not say what percentage…

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DON’T BE A VICTIM: UID Chief urges people to write purpose on Aadhaar copies

The head of the Unique Identity Authority of India has urged the public to write down the purpose and date when they submit photocopies of their Aaadhar cards to exchange currency notes to prevent misuse. “Photocopies of the Aadhaar letter are being submitted by the general public to banks. We urge them to clearly indicate the purpose for which they are submitting the same along with the date and time. This actually is a good practice whenever they submit photocopies of documents,” said Ajay Bhushan Pandey, Chief Executive Officer of…

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