Bank employees to strike work from Jan 21

Public sector bank employees have decided to go on a 4-day strike from January 21 to protest against the “rigid and callous attitude” of Central Government in resolving the long pending wage revision issue, a senior union leader said here today.

Earlier, it was decided to hold 1 day strike on January 7, which was deferred on the request of IBA to find out an amicable solution, All India Bank Officers’ Confederation (AIBOC) State Secretary Deepak Kumar Sharma said.

The decision is in response to the strike call given by United Forum of Bank Unions, which has more than ten lakh employees and officers of banking Industry under its umbrella.

“As there was no fresh proposal of hike from the side of IBA during this period, UFBU has decided to go ahead with the 4-day strike which will have the impact of 6 days as 25th is Sunday and 26th January is national holiday,” Sharma added.

The wage revision for bank employees is due from November 1, 2012, he said.

UFBU has been requesting, since the start of negotiations, a time-bound approach to hold the negotiations on its demands and for conclusion of wage settlement within a reasonable time but there is no significant progress in the wage negotiations despite a lapse of two years’ time, he said.

He claimed that despite disparity in wages and hardships of unlimited working hours, the employees of the banking industry, the backbone of the economy, are denied their due share.

Sharma said this was despite the workers being recognised by all for achieving all National/Social objectives set before them including opening of Jan-Dhan Yojna Accounts“.

He said the Public Sector bank employees have also decided to go on an indefinite strike from March 16 onwards and that the notice in this regard has already been served by UFBU to the IBA.

Source : Thehindubusinessline

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Kotak Mahindra Bank brings banking on social media platforms

In an attempt to connect to the net-savvy and socially connected customers, the private sector lender Kotak Mahindra Bank on Monday announced the launch of Jifi Saver, a savings bank account which can be managed via social media platforms like Twitter and Facebook.

To tap the growing e-commerce industry in the country and increasing users of social media platforms, Kotak Mahindra Bank will provide basic services like inquiry for balance, last few transactions, chequebook demand among a total 21 services under the name "Hashtag Banking (#banking)". Besides the normal banking services, the bank will also offer additional transaction points for purchase from select ecommerce partners to lure customers.

"Jifi Saver will take care of customers' needs such as online shopping, on-the-go transactions, financial planning, etc. It also offers all benefits and functionalities of a regular savings bank account," said Deepak Sharma, executive vice-president and head- digital initiatives, Kotak Mahindra Bank.

Interestingly, the bank has seen rapid rise in online banking as about 40 per cent of its existing bank customers are using online banking.

However, use of social media in the banking operations is the first such attempt by any bank in the country. "Before launching, we had done extensive research and testing for a secured technology platform. Financial transactions can't happen through Twitter or Facebook. For that, one has to come to Bank's system, which is having multi-layered security. Hence, there is zero possibility of losing a single rupee while doing banking through Jifi Saver account on social media platforms," said Sharma adding that the product was passed after scrutiny by experts from the Reserve Bank of India (RBI).

"With Jifi it will be easy to recharge mobile and DTH recharge via Twitter. We are the first bank in the world to offer banking service using social networks," Sharma said.

Jifi Saver is presently available in 27 cities in the country, these include mainly those cities with high digital penetration. In Gujarat the bank will offer services in Vadodara, Surat and Rajkot besides Ahmedabad.

Source : Thehindubusinessline

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RBI cautions against foreign 'investment tourists'

The Reserve Bank of India official today cautioned against foreign "investment tourists" in debt markets, highlighting concerns about short-term flows.

The comments from G. Padmanabhan, executive director at the RBI, came amid expectations that India will allow Euroclear settlements for government debt only for long-term investors.

He added that RBI will increase foreign investment limits in govt debt in "calibrated and gradual manner".

"The financial stability implication of 'investment tourists' exiting at a whiff of trouble has always to be kept in mind as we progress along the path of liberalization," said Padmanabhan in a speech uploaded by the RBI

He was speaking to the Primary Dealers Association of India on Saturday at their annual meeting.

The proposals for allowing international settlement of government bonds could increase attractiveness with foreign investors but also lead to creation of "NDF-like market overseas", said Padmanabhan.

Gross market supply of debt will remain elevated "in the foreseeable future" as the government will continue to run deficits despite fiscal consolidation plans, he said.

Source : Thehindubusinessline

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ICICI Bank launches money transfer service on Twitter

ICICI Bank, India's largest private bank, has launched its banking services on Twitter enabling customers to transfer money through the micro-blogging Web site.

Savings account customers can register their Twitter account with a onetime password and link their account number.

Customers can send up to Rs. 5,000 per transaction with a limit of Rs. 10,000 per day. The online NEFT charges will be applied.

Both the recipient and sender need to have a Twitter account.

This facility also enables customers to view their account balance, view the recent transactions and recharge mobile pre-paid through Twitter.

"Mobile transactions account for 10 per cent of our total transactions, increased from 2 per cent in 2.5 years...We have about 2.8 million customers on mobile banking, while about 15 million Internet banking users," said Rajiv Sabharwal, Executive Director, ICICI Bank.

ICICI Bank also plans to launch digital wallets ad digital wearables in the next few months.

Source : Thehindubusinessline

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Why private banks lag on the Jan-Dhan front

While private sector banks have shown impressive performance on a host of parameters, such as net profit growth and better asset quality, their performance with regard to the Pradhan Mantri Jan-Dhan Yojana (PMJDY) has been far from impressive.

According to data up to January 12, 2015, private banks have opened a mere 3.14 per cent of the total accounts opened under the scheme.

This translates to 35.08 lakh accounts out of a total of 11.16 crore accounts opened. Of these, two private sector banks — HDFC Bank and ICICI Bank — have opened about 40 per cent of accounts.

Public sector banks have opened 8.84 crore accounts and regional rural banks 1.96 crore accounts since August, when the scheme was launched.

Reasons aplenty

Private sector bankers say there are several reasons why account opening by them has been disproportionate to the assets they hold. Private banks control approximately 21 per cent of all assets in the banking system.

None of the private bankers wanted to come on record because finance ministry officials are well-versed with the issues these banks raise in the weekly progress call.

One private sector banker said the areas allotted to them are not where they currently do business or intend to do business anytime soon. “There are issues with distribution of territory to open these accounts,” the banker said, adding, “this is not at par with penetration of the bank’s branches.”

Another private sector banker cited viability issues related to private sector banks not stepping on the gas with respect to the scheme.

“The account’s viability has to be looked at. The operating costs and average balances are the concerns. It has to be also viable from other products’ point of view as well. On a standalone basis, it is difficult to make it sustainable,” he said According to indications, this is borne out in the numbers put forth by scheme managers on the website.

According to the figures, there are 8.69 crore accounts where not a single rupee has come in. The overall balance in the remaining accounts totalled Rs. 8,760 crore as on January 12. This translates to a balance of about Rs. 2,910 per account in the remaining 3.01 crore accounts.

Early days?

But is it valid to judge the viability of a business so soon? According to the chairman of a public sector bank, “Opening of these accounts is certainly not a loss-making business. We are not making any money on it yet, but nor are we losing anything.”

It will take some time for the money to flow in and the direct benefits transfer scheme of the government will play an important role in swelling the cash balances in these accounts, he added.

The key factor will be spreading awareness and encouraging the public to keep money in their accounts, while banks will have to work hard to create awareness, according to the public sector banker quoted above.

“Private banks always enter all such businesses late…they simply want to ride on the infrastructure that public sector banks put in place,” he claimed. Another private banker was more forthcoming when he said, “It’s a mindset issue as well for private banks. We need to look at it as a business model. Breakeven cost Rs. 120 per account.”

In comparison, the cost of opening these accounts is Rs. 200-250 per account.

Source : Thehindubusinessline

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