Mumbai (Maharashtra) [India], August 4 (ANI): Government-owned State Bank of India (SBI) on Wednesday reported its highest quarterly net profit of Rs 6,504 crore in the April to June quarter, marking an increase of 55 per cent in the year-ago period.
Operating profit increased by 5 per cent to Rs 18,975 crore in Q1 FY22 from Rs 18,061 crore in Q1FY21. Net interest income increased by 3.7 per cent year-on-year.
On the other hand, non-interest income at Rs11,803 crore grew by 24 per cent, said the country’s largest lender in a statement.
Total deposits grew at 8.82 per cent to reach Rs 37.2 lakh crore in Q1 FY22 from Rs 34.2 lakh crore in Q1 FY21. While current account deposits grew by 11.75 per cent, saving bank deposits grew by 10.55 per cent.
Domestic credit growth stood at 5.64 per cent, mainly driven by retail customers. Home loans, which constitute 23 per cent of the bank’s domestic advances, moved up by 11 per cent.
SBI said net NPA ratio stood at 1.77 per cent, down by 9 basis points. Gross NPA ratio came at 5.32 per cent, down 12 basis points.
The slippage ratio for Q1 FY22 is at 2.47 per cent from 0.6 per cent as at the end of Q1 FY21. Credit cost declined 77 basis points year-on-year to 0.79 per cent.
Cost to income ratio declined from 54.5 per cent in Q4 FY21 to 51.89 per cent in Q1 FY22 but increased by 187 basis points year-on-year, said SBI.
Capital adequacy ratio improved by 26 basis points to 13.66 per cent as on June 2021. Return on assets increased by 15 basis points to 0.57 per cent in Q1 FY22 against 0.42 per cent in Q1 FY21.
Return on equity increased by 357 basis points to 12.12 per cent against 8.55 per cent in the same period.
At 2:15 pm, SBI stock was trading 3.6 per cent higher on NSE India at Rs 462.55 per unit. (ANI)
A parliamentary panel has suggested having a benchmark for the “quantum of haircut” in an insolvency process amid instances of financial creditors taking steep haircuts on their exposure to stressed companies.
Besides, the committee has pitched for measures to prevent protracted litigations with respect to an insolvency resolution process.
The Insolvency and Bankruptcy Code (IBC), which came into effect in 2016, provides for a market-linked and time-bound resolution of stressed assets.
Emphasising that the fundamental aim of the Code is to secure creditor rights which would lower borrowing costs as the risks decline, the panel said there is a need for greater clarity in purpose with regard to strengthening creditor rights through the mechanism devised in the Code.
On haircuts
The committee flagged that “the low recovery rates with haircuts as much as 95 per cent and the delay in resolution process with more than 71 per cent cases pending for more than 180 days clearly point towards a deviation from the original objectives of the Code intended by Parliament”.
The committee particularly mentioned about the “disproportionately large and unsustainable ‘haircuts’ taken by the financial creditors over the years”.
In some insolvency resolution processes, the haircuts taken by creditors were more than 90 per cent.
“As the insolvency process has fairly matured now, there may be an imperative to have a benchmark for the quantum of ‘haircut’ comparable to global standards,” it noted.
A haircut refers to losses incurred by creditors on resolution of a stressed asset.
The suggestions have been made by the Standing Committee on Finance in its report on the ‘Implementation of Insolvency and Bankruptcy Code – Pitfalls and Solutions’. The report was tabled in Parliament on Tuesday.
On delays
It is a matter of grave concern for the committee that the insolvency process has been stymied by long delays far beyond the statutory limits. It is disconcerting that even admission of cases in NCLT has been taking an unduly long time, which thus defeats the very purpose of the Code, the panel noted.
After about half a dozen amendments in five years, the IBC seems to have deviated from its original objectives, thanks to inordinate delay in resolution and the low recovery rate with haircuts running up to 95% in few cases, the Parliamentary Standing Committee on Finance said in a report.
As many as 13,170 insolvency cases involving claims of Rs 9 lakh crore are awaiting resolution before the National Company Law Tribunal (NCLT), the report tabled in the Lok Sabha on Tuesday said.
The committee also pointed out that there have been instances of frivolous appeals, which further drags the resolution/ recovery process leading to severe erosion of asset value.
Abuse of provisions
The panel said it would therefore recommend that misuse/ abuse of well-intended provisions and processes should be prevented by ensuring an element of finality within the statutory stipulated period without protracted litigation.
There have been six amendments to the Code so far.
According to the committee, any legislative enactment and implementation need to constantly evolve to meet the challenges in the ever-changing ecosystem.
However, the panel said it is of the opinion that “the actual operationalisation of amendments made so far may have altered and even digressed from the basic design of the statute and given a different orientation to the Code not originally envisioned”.
Shivalik SFB recently attained SFB status post successful transition as an Urban Co-operative Bank (UCB). The funds will be leveraed for digital expansion through fintech partnerships, physical expansion and product innovation.
Harsh Mittal, Chief Financial Officer, Shivalik Small Finance Bank said, “Our journey as a Small Finance Bank has been very exciting so far. The pace at which we have made progress to swiftly reach this stage is testimony to how meticulously we have planned our growth strategy, complemented by steps taken along the way to ensure we maintain a healthy balance sheet. We are pleased toappointEquirusCapital for the bank’s first fundraise as we look to onboard investors who believe in the vision of providing digital focussed financial services to the small and underserved segments.”
Donald D’Souza, Managing Director and Co-Head at Investment Bank, Equirus Capital, “We are delighted to partner with Shivalik Small Finance Bank to assist them in executing their growth plans including in their capital-raising plans. We look forward to a long and fruitful association with the bank.”
The bank is in talks with a number of fintech and financial institutions for business collaboration in the area of deposits, loans and third-party products, including customer onboarding and digital payments.
Venture lending fund Stride Ventures on Wednesday announced the first close of Stride Ventures India Fund II, for which it has secured commitments of ₹550 crore.
Stride Ventures has secured commitments of ₹550 crore, out of its target corpus of ₹1,000 crore, with an additional greenshoe option of ₹875 crore.
The fund received approval for its ₹1,875 crore plan from Securities Exchange Board of India (SEBI) in June 2021.
Stride Ventures founder and managing partner Ishpreet Gandhi said that there has been considerable tailwinds in the Indian startup ecosystem which presents a perfect opportunity to invest in the potential of venture debt in India.
“With the majority of investors from our maiden fund returning to invest in the new fund, we have had a quicker-than-expected first close. Their confidence remains resolute in our mission to build innovative alternate financing solutions for founders to help scale their startups more efficiently,” Gandhi said.
The firm remains on track to announce the final close of the second fund by the end of 2021. With its ability to recycle capital, Stride will effectively have more than ₹3,000 crore for funding startups across the tenure of the fund, the statement said.
Fund deployment
The firm aims to ramp up deployment in late-stage startups across sectors like business-to-business (B2B) commerce, healthcare, agritech, fintech and direct-to-consumer (D2C) brands with average ticket size of up to ₹75 crore.
“In addition to family offices and institutional investors, the firm will diversify its investor base outside India for Stride Ventures India Fund II, on the lines of the maiden fund. Amid growing investor confidence and a maturing Indian startup ecosystem, the new fund represents a significant opportunity for the firm to build a robust pipeline of deployments in the coming months,” the statement said.
Founded in 2019, Stride Ventures closed its maiden fund of ₹350 crore earlier this year.
Stride Ventures have made disbursals of over ₹400 crore in 2021, through 20 investments which includes start-ups like Pocket Aces, Miko, SUGAR Cosmetics etc and late stage startups like Infra.market, Spinny, Home Lane, Zetwerk and Bizongo.
Bitbns, the cryptocurrency exchange, has announced Bitcoin SIP awards for Indian winners at the Tokyo 2020 Olympic Games in its bid to recognise and celebrate Olympic champions where winners would be entitled to open cryptocurrency SIPs’ worth lakhs on the exchange.
The SIP will start onwards from Rs 2 lakh for gold, Rs 1 lakh for silver, and Rs 50k for bronze medalists. The company aims to begin with honoring Mirabai Chanu for bagging a silver medal in weightlifting in the 49 kg category and PV Sindhu, who won the bronze medal after defeating Bing Jiao of China in badminton to become the 1st Indian woman with 2 individual Olympic medals.
Gauarv Dahake, CEO, Bitbns said, “As India celebrates its 100-year journey with the biggest global sporting event, Bitbns is proud to associate and play its bit in honoring the Indian Olympic champions. Indian athletes winning medals at the Olympics are not just fulling their dreams but the dreams of billions of Indians while making the country proud on a global platform. I would like to convey my heartiest congratulations to Mirabai Chanu and P.V. Sindhu for bringing home the medals.”
“Bitcoins and Ethereum have been the best-performing assets in the last decade, and have given exceptional returns and we aim to get our winners to indulge in this rewarding journey. Our Olympians are the personification of sheer grit, valour, and commitment and the sense of pride they gift us is immeasurable. This is a small gesture from us to gratify them in our own way.” he added further.
It’s not just retail, non-collateralised loans that are seeing delinquencies. Home loans that are mortgage-backed are seeing stress due to the pandemic.
Home loans of many banks have seen signs of stress with data from IMGC, a leading guarantor of such advances pointing to
an increase of nearly three times in the mortgage delinquency pool over the past 15 months.
The number of claims paid by IMGC has gone up three times in June since March 2020, but it feels that the worst is over for the segment and the situation will stabilise in the next six months.
LIC Housing Finance has said there has been an increase in delinquencies, mostly due to economic activities being impacted in Q1. With improvement in economic activities and our increased and focused efforts in recovery, it was confident of controlling the same.
For LIC Housing Finance, on the asset quality, the stage-3 exposure at default worsened to 5.93%, from 4.12% a quarter ago and 2.83% a year ago.
There was a sharp deterioration in asset quality across product segments. Developer/Project GNPA deteriorated to 24.4% (down 640 bps quarter on quarter). According to brokerage estimates, in addition GS3, its Developer/Project book has at least 25% of restructured advances and ~16% in Stage 2.
Total restructured advances of LIC Housing Finance stood at Rs 5,350 crore (of which an estimated 88% were loans to corporate/developers). Against this, LICHF has made additional provisions of Rs 5,000 crore. Around Rs 1,500 crore of Covid-related provisions were booked in the First quarter
Housing finance companies
Non-bank lenders have restructured loans worth 1.6% of their overall book. Out of this while housing finance companies restructured about 1.0% of their AUM, other NBFCs restructured about 2.2%.
According to the rating agency Icra, the restructured book for non-bank lenders is expected to move up to 4.1-4.3% by March 2022 while the same for housing finance companies is estimated to go up to 2.0-2.2%.
The second wave of the Covid pandemic significantly impacted the collection efforts of non-bank lenders especially those in the business segments of vehicle finance, business loans and micro finance, who witnessed their collection efforts decline by about 20-25% in May 2021 versus March 2021. The efficiency improved by 3-5% in June 2021.
TThe loans due beyond 90 days, in March 2021 increased by only 30-40 bps over March 2020 levels, as the collections had improved steadily. Several institutions resorted to high quantum of loan write-offs in the fiscal year gone by which was estimated to be about 1.6% of the total assets under management, which is higher by about 60 basis points over the last fiscal.
EMI payments (loans, insurance, mutual funds) can be made via UPI AutoPay without missing due dates or setting reminders.
Payments made on time avoid late fees and penalties.
In UPI recurring mandates, each customer can choose from a variety of payment modes (monthly, quarterly, etc.) and quantities (from Rs.1/- to Rs.2000+).
Recurring payments made in a secure and convenient manner.
Transacting without using cash.
There will be no long lines.
There is no paperwork required.
For Transit:
UPI offers a variety of passes on a daily, weekly, and monthly basis.
There will be no longer fines or penalties for travelling without a ticket.
There’s no need to be concerned about losing tickets.
It’s the epitome of convenience.
For Educational Services:
Education packages can be customized to meet specific needs.
Payments that are simple and quick gaining. information from the comfort of one’s own home.
For Ecom
The UPI AutoPay service allows you to buy now and pay later.
For retailers, it’s simple to deliver to their doorstep.
Convenience is right outside your door (No searching for change etc)
Modify, revoke, and pause tools are also provided for amending orders as needed.
How does UPI AutoPay work?
A ‘Mandate’ option will be available in any UPI-enabled application, allowing customers to establish, approve, alter, stop, or revoke an auto-debit mandate. To use the UPI Autopay feature, follow this step-by-step guide.
Authenticate your account with a UPI PIN once, and subsequent monthly payments will be automatically debited from your account.
For transactions up to Rs. 2000, create an e-mandate using a UPI-enabled bank ID or a QR scan.
Every mandate will demand a UPI PIN authentication for transactions exceeding Rs. 2000.
One-time, daily, weekly, fortnightly, monthly, bi-monthly, quarterly, half-yearly, and yearly mandates are all possible.
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In the present era, especially in the wake of first and second Corona, undertaking jobs on a freelance basis has become one of the most promising patterns of working/work culture.
Here in this discussion, we shall take a dive in this issue from various perspectives and specifically from the tax perspective.
Freelancing connotes a situation wherein an individual has been temporarily hired to undertake and complete the specific assignment and instantly get paid on completion and submission of the assignment.
In such aforesaid cases of freelancing, An individual is not an employee of the company and so is not placed on its payroll. He is not entitled to get perks (like Provident Fund) as mandated by the Companies Act. An individual is not required to go to the office. He can complete the assignment at leisure (as per pre-agreed guidelines) from any place that is convenient to him.
Any income that is earned by displaying manual or intellectual skills comes within the purview of income from a profession as per prevalent income tax laws of India. And such income shall be taxable as “Profits and Gains from Business or Profession”. His gross income shall be the sum of all the receipts that he gets while carrying out his profession.
To cull the information, the document taken into consideration is a bank account given the condition that an individual has received all his professional income through the banking channels.
Expenses Allowed as Deduction
As per the Income Tax Act 1961, freelancers can deduct those expenses that they have incurred to carry on the job from their income. And This could be anything that is directly related to the job of the freelancer ranging from the office furniture to expenses on visiting the clients.
Prerequisites to claim the deduction of expenses from the Freelancing Income:
The expense must have been incurred during the year in which tax is to be paid.
The expense must have been spent fully and exclusively too for the purpose of carrying on the freelance income.
The income must not be illegal.
The expense incurred must not be personal expenditure or capital expenditure of the freelancer
Taxes payable for a freelancer
If the total tax liability during a particular financial year amounts to Rs 10,000 or more, then the taxpayer is required to pay the taxes every quarter which is called advance tax.
Modus operandi of calculating the advance tax
Add up all your total receipts and then determine your total income.
Subtract those expenses that are directly related to your work.
Then Add the income from other sources, for instance, house property or a savings account.
Thereafter, Find out the tax slab that you belong to and then calculate your tax that is due.
Don’t forget to deduct the TDS
If the tax that is due exceeds Rs.10,000, then you are necessarily required to pay the advance tax by the due dates.
Penalties for non-payment of advance tax
If the advance tax is not paid by the free-lancer then interest as per section 234B and section 234C is applicable. So to remove paying the interest penalty, follow the below-mentioned guidelines: ● Pay advance Tax only when your tax liability for a year is Rs 10,000 or more ● The Advance tax payments that have been made until 31st March of the year should be 100% of the individual’s total tax payable.
The Applicability of GST to freelancers
Before July 2017, VAT & Service Tax were applicable on freelancers. Now the above-mentioned taxes have been replaced by the GST.
1) Tax if you sell goods
The GST rate applicable shall be decided by nature of items.For Instance, if you make and sell confectionery items such as cake, the GST levied shall be 18%.
2) Tax If you provide Service
Again, it depends on the nature of the services. In most cases, 18% GST is applicable on most of the services. And keep in mind to charge GST from your clients.
(Amit Gupta, the author of the article is the Managing Director of SAG Infotech)
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Story first published: Wednesday, August 4, 2021, 13:29 [IST]
GoSats; a Bitcoin Rewards Company, has raised $700k seed funding from a group of investors. The platform focuses on mainstreaming bitcoin adoption to help average consumers become passive earners of bitcoin.
The seed funding round featured some prominent names like Alphabit Fund, Fulgur Ventures, Stacks Accelerator, and SBX Capital. The funding round was also supported by a few angel investors including Ajeet Khurana, former CEO of Zebpay, Sathvik Vishwanath, CEO of Unocoin, Mohit Madan, Co-Founder of Oropocket, Sharan Nair, CBO of Coinswitch Kuber, and a few others.
Trevor Owens, the Managing Partner at Stacks Accelerator said, “GoSats is the gateway for a billion people in India to own Bitcoin. In a time when inflation is destroying wealth around the world, Bitcoin protects the wealth of people and allows them greater freedom and ownership over their future. That’s a great thing, and I’m honored to be an investor in a company that can benefit so many people.”
CEO of GoSats, Roshan, also the former Chief Scientist of Unocoin, shares his views about the vision and growth of the company saying, “It’s fascinating that a significant number of our user-base never held bitcoin before they signed up with GoSats and we are happy to facilitate their journey into the world of crypto-assets in a risk-free manner. Through this funding, our focus is to scale the adoption of bitcoin in India and to build a bitcoin rewards solution for brands.”
