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Wednesday, September 23, 2015

Citi launches integrated banking product for younger customers

American lender Citi today announced a new product offering in the country targeted at people below 40 years of age, seeking to address multiple banking needs of the growing segment through a single relationship.

The bank commissioned an in-house study which showed there is an emerging class of wealth builders globally and India is witnessing the fastest growth in this class, Citi's country business manager in the global consumer bank, Kartik Kaushik, told reporters here.

He said this segment has peculiar banking needs for saving, wealth management, international travel and lifestyle, and Citi launched its new offering 'Citi Priority' seeking to address the same.

It involves giving a bouquet of offerings to the customer, he said, adding that for the first time a bank is combining a credit and debit card as part of the offering.

The service comes free for the consumers if they maintain a 'relationship value', which includes savings, credit cards, mortgages, travel bookings, etc of Rs 15 lakh per year, he said, adding that fees set in if the value falls below the level.

India is the fifth market globally where 'Priority' has been launched and there are six more geographies where it will be launched soon, he said.

Kaushik said the larger focus of the bank is to expand Citi's 'share of wallet' and not on acquiring customers. He said he expects ten per cent of the individual account holders to sign up for the new offering, but declined to give the overall base.

For Citi India, the youth segment constitutes a fifth of the overall revenues and it has been outgrowing other segments by up to three times, he said.

He exuded confidence that shifting from a current perspective of selling multiple products to a single customer, to giving a single offering to a customer for free, will not hurt its revenues in the long term as the volume of transactions grows.

Source : Economic Times
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SKS Microfinance cuts interest rate by 1.25%

SKS Microfinance has announced a 1.25 per cent reduction in the interest rate charged to borrowers from 22 per cent to 20.75 per cent with effect from October 1, 2015, for all future disbursals.

This is the third interest rate cut effected since October 2014.

In July 2015, the MFI had cut the lending rate by 1.55 per cent. In October 2014, it had reduced the rate by 1 per cent.

SKS Microfinance, in a statement, said it could reduce its cost of interest-bearing liabilities to 11.9 per cent in Q1FY16 from 13.6 per cent in FY14 on account of downward adjustments in risk premium.

"...Improved profitability in FY15 and Q1-FY16, capital raised in May 2014, a rating upgrade, and issuance of commercial papers and non-convertible debentures are the factors that drove the reduction in its cost of borrowing," it said.

Source : Thehindubusinessline
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Federal Bank bets big on network expansion, localised services

Federal Bank’s growing physical presence, away from its homeground in Kerala, has translated into more business from branches outside the State.

The bank expanded its presence outside Kerala to 52 per cent of branches opened currently, from 42 per cent in 2012. At present, 41 per cent of the total business comes from outside Kerala and the aim is to double the market share in these geographies, said KA Babu, Head – Retail Business.

Rising figures

In the last four years, more than 500 branches were opened, mostly in the western, northern and north-western parts of the country. Besides, higher penetration into Tamil Nadu and Karnataka has also helped increase the share, he told BusinessLine.

The resident savings bank account portfolio, an indicator of the bank’s reach in a market, has shown a growth of 23 per cent since 2012, to reach around Rs.4,000 crore. He attributed this to strategies, such as ‘Go-to-market’ that has helped expand the customer base.

CASA share

The total CASA share has also improved to 26 per cent from 22 per cent, he said.

This has been achieved by the introduction of a new in-house sales vertical, the lead taken by senior executives in network expansion, and shifting of the national sales office from Kochi to Mumbai to reach out to a large cross-section of select geographies, he said.

According to Babu, “The thrust given on local recruitments has paid rich dividends on brand enhancement on a macro level, and addition of local flavour to customer service has done the same at the micro level.”

Participation in various customer engagements, focussing on housing complexes, companies, etc and the offering of e-fee collection facility in educational institutions helped grow CASA and salary accounts.

Fedfina – the 100 per cent subsidiary and distribution arm – has also extended exclusive support for the reach and business.

Reward programmes

The starting of loyalty rewards on its debit card has supported increased inflow into CASA.

The bank started giving more attention to corporate salary accounts, where offers like co-branded credit card, overdraft facility and personal loans, added value and gave a shot in the arm to marketing efforts.

Besides giving attention to increasing the reach and customer acquisition, the bank strives to enhance convenience and positive experience.

Source : Thehindubusinessline
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Dena Bank extends loan coverage

Dena Bank has extended the ‘Mudra’ loans, which are essentially meant for funding the unfunded, to 9,128 borrowers amounting to Rs.166.54 crore since the scheme was launched in April 2015, according to Ashwani Kumar, Chairman and Managing Director.

Speaking at the launch of the bank’s Mudra Card, Kumar said the bank plans to arrange Special Credit Camps all over India from September 25 to October 2 to extend Mudra loans.

It has been assigned a target of Rs.605 crore by the Centre for financing under the Pradhan Mantri MUDRA Yojana.

Source : Thehindubusinessline
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