LIC to stop selling 34 policies in December

Insurance giant Life Insurance Corporation has decided to stop selling as many as 34 policies, including Jeevan Anand, Jeevan Madhur and Jeevan Saral, to comply with new regulatory guidelines.

These policies are withdrawn in December as they are not in conformity with the provisions of new regulations on non-linked insurance products, linked insurance products and health insurance products, a senior LIC official said.

Of the 34 products, LIC will stop sale of Jeevan Amrit from December 7, Jeevan Surabhi from December 14 while two other schemes from December 21 and December 28 respectively.

Remaining 28 policies will go off LIC’s shelves from December 31.

Last month, LIC had withdrawn 14 policies including Convertible Term Assurance, Children Deferred Endowment Assurance.

These policies are being discontinued as part of regulatory compliance.

The Insurance Regulatory and Development Authority (IRDA) had extended the deadline for implementation of new individual product regulations for the life insurance industry by three months to December 31.

The new guidelines are aimed at making insurance policies more customer-friendly.

“All the existing group policies and all the existing individual products not in conformity with the provisions of this regulation shall be withdrawn from August 1, 2013, and January 1, 2014, respectively,” IRDA had said in a circular.

With regard to group policies, life insurers have been asked not to enrol these policies after the immediate policy anniversary falling due after July 2013.

However, it had said all group policies at the time of renewal of such policy shall be given an option to switch over to the modified version of the group product, if any, once introduced.

LIC has outperformed its peers in the private sector by recording a 7 per cent growth in premium collection during the first half of the current fiscal.

The company witnessed a 7.26 per cent growth in premium income to Rs 37,906 crore during the six-month period ending September.

Source: thehindubusinessline

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Punching PIN must for debit card transactions from 1st December 2013

Debit card holders will from tomorrow be required to punch in their PIN numbers every time they use the card, a move aimed at minimising frauds.

In June, the Reserve Bank had extended the deadline for implementation of mandatory PIN punching at Point-of-Sales (PoS) and merchant outlets till November 30 following representation of banks.

“Our back-end system is in place and we have made changes in all our PoS and merchant outlets to accept PIN (basically ATM PIN) from tomorrow,” said Parag Rao, HDFC Bank’s head card payment products and merchant acquiring service.

“We have around 3 lakh PoS terminals across the country,” he said, adding that the bank has informed all its customers through all channels including SMS and mailers.

As part of awareness drive, SBI has in a notice asked its customers not to handover ATM-cum-Debit card to any person.

It also advised the customers that they should not keep any records of the PIN in physical form.

According to a senior official of Canara Bank, the PIN is another layer of security for the debit card.

First, merchants will swipe the cards at a PIN enabled PoS terminal and punch in the transaction amount. That will be followed by customers entering their PINs to complete the transaction.

As for credit cards, this requirement has been made mandatory for international transactions, including on the Internet. In such cases, users will have to replace their existing credit cards with the EMV Chip card and get a PIN.

Increased use of credit and debit cards has led to rise in frauds, especially in the case of lost or stolen cards.

Also, there have been reports of data on cards being compromised and cards skimmed/counterfeited.

To deal with this the Reserve Bank asked banks to comply with all security features such as EMV (Europay, MasterCard and Visa) chip on cards, real time fraud monitoring system, use of PIN, limit on transactions and the like by November 30.

RBI had in September, 2011 issued the guidelines for additional security features with a view to guarding card holders against cyber frauds and other misuse.

Source: thehindubusinessline

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Oriental Bank cuts lending rates for MSME advances

Oriental Bank of Commerce (OBC) has slashed its lending rate for MSME advances as part of its efforts to kickstart revival in this sector.

This public sector lender is confident of making good the revenue loss from such a move with expected increase in business volumes, S.L. Bansal, Chairman & Managing Director, OBC, told Business Line.

OBC may take a revenue hit of about Rs 30 crore in the remaining four months, but this could be covered with higher business volumes, Bansal added.

The basic purpose for the rate cut decision is to give a push to the MSME sector in the current times of economic slowdown, Bansal said.

Also, there is not much demand for credit from large corporates. MSME advances account for nearly 15 per cent of the total advances of the bank.

Micro, small enterprises

Lending rates for micro and small enterprises have been reduced from 25 basis points to 75 basis points for advances above Rs 25 lakh and up to Rs 1 crore.

For advances above Rs 1 crore, the reduction in interest rate ranges from 50 basis points to 200 basis points.

Medium enterprises

OBC has slashed the interest rate by 25 basis points to 150 basis points for advances up to Rs 1 crore.

For advances above Rs 1 crore, the lending rate reduction ranges from 50 basis points to 150 basis points.

Effective date

All the revision in lending rates will be effective December 1 and be applicable to all the existing as well as fresh advances sanctioned to MSMEs under manufacturing as well as services sector.

Srivats.kr@thehindu.co.in

Source: thehindubusinessline

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Recovery hubs help United Bank trim bad loans by Rs 800 crore

The United Bank of India (UBI) on Saturday said it had reduced non-performing assets (NPAs) to the tune of Rs 800 crore. A further Rs 600 crore would be recovered “shortly”.

“Recovery hubs have been formed at strategic centres and the Bank has reduced NPAs by Rs 800 crore and will upgrade another Rs 600 crore, shortly,” it said in a release.

For the quarter ending September 2013, UBI reported a net loss of nearly Rs 490 crore. Increased provisioning (by nearly four-fold) to Rs 987 crore, as compared to Rs 259 crore in July–September 2012 impacted the bottom line.

It also reported increased NPAs. Gross NPA (till September 13) rose by Rs 3,868 crore, to approximately Rs 6,286 crore — a 160 per cent increase from Rs 2,418 crore in September last year.

Net NPAs for the period (July to September 2013) too increased by 270 per cent to approximately Rs 4,385 crore; from Rs 1,188 crore in the corresponding quarter last fiscal.

Increased Business

UBI, according to the release, has crossed Rs 200,000 crore in total business (deposits and advances); witnessing a 30 per cent year-on-year- growth in advances to the SME, agriculture and retail sectors.

Customer base increased by 30 lakh and nearly 150 branches were opened across 14 new states over the last five months.

Capital Infusion

Meanwhile, the Bank pointed out that it was “well capitalised” with capital adequacy of 9.48 per cent. It was the first Bank to raise Tier-II (Basel III compliant) capital of Rs 500 crore during the current fiscal.

UBI will get Rs 700 crore as capital from the Centre.

abhishek.l@thehindu.co.in

Source: thehindubusinessline

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Corporation Bank opens SME loan centre at New Delhi

Corporation Bank has sanctioned more than Rs 3,000 crore from April to October through its SME (small and medium enterprises) loan centres in the country.

A press statement by the bank said here that the bank opened its 17th SME loan centre in Delhi on Saturday. It said that the bank accorded a cumulative sanction of Rs 3,006 crore in 2,281 accounts from April to October during the current financial year through its SME loan centres in the country.

With the launch of New Delhi (North) SME loan centre, the total number of SME centres of the bank has increased to 17. The bank has plans to open nine more centres during the current financial year.

S.R. Bansal, Chairman and Managing Director of the bank, inaugurated the SME loan centre in New Delhi.

vinayak.aj@thehindu.co.in

Source: thehindubusinessline

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