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In a note, which pegged the overall retail deposits in the system at Rs 102 lakh crore, the economists led by Soumya Kanti Ghosh said: "If not for all the depositors, the taxation review should be carried out for at least the deposits made by senior citizens who depend on the interest for their daily needs."
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Ajit Prasad Press Release: 2021-2022/896 |
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New card additions were the highest for ICICI at 655,000 during this fiscal while added 198,000 cards being the highest in the past 16 months.
HDFC Bank, on which RBI recently lifted a ban of issuing new credit cards, has announced a tie-up with leading payments company Paytm to start selling co-branded plastics before the onset of the festive season. The credit cards will be powered by Visa and will include offerings targeted at millennials, business owners and merchants, an official statement said.
Paytm has a reach of over 330 million consumers and 21 million merchants, while HDFC Bank has over 5 million debit, credit and prepaid cards, and serves 2 million merchants through its offerings.
HDFC Bank, the largest private-sector bank which also leads the credit card segment, was banned from issuing new credit cards for over eight months as a penalty for frequent outages. After the lifting of the ban, it outlined aggressive plans to regain lost market share in up to a year.
The bank had said that it will focus on distribution partnerships to achieve its target, under which it envisages ramping up new credit card sales to 5 lakh a month by end of the fiscal from 3 lakh in November 2021.
HDFC Bank and Paytm had last month announced a tie-up on the payments side. Paytm already has a tie-up with foreign lender Citi under which co-branded credit cards are issued. Citi is looking to exit retail banking activities in the country.
The launch of the HDFC Bank-Paytm co-branded cards is slated for next month, ahead of the festive season which typically sees a spurt in spends, the statement said, adding a full suite of products will be available by December.
Yes Bank ties up with Visa
Yes Bank has tied up with Visa to issue credit cards to its customers on the payment platform, which includes a suite of nine credit card variants. The Yes Bank card issuances were hit after RBI had banned Mastercard from issuing cards.
“The transition has been achieved within a record time of less than 60 days, ensuring ease for customers across segments,” the bank said.
Yes Bank and RBL Bank were hit the most by the Mastercard ban as their entire card network was on it. RBL Bank had announced a tie-up with Visa the day after the curbs on Mastercard were announced and resumed issuing cards from September 15. Yes Bank’s Visa credit cards, announced today, will service all segments–consumer cards, business cards, and corporate cards across YES First, YES Premia and YES Prosperity.
AU Small Finance Bank
AU Small Finance Bank (SFB) has issued over 40,000 credit cards since its launch a few months back, and more than half of them are first time users. The Jaipur based lender said it is the first SFB to enter semi-urban and rural areas with its own credit cards. It also offers a special Altura plus credit card to empower women to experience a limitless living.
In future, the bank is also working on bringing out its limited-edition cards, featuring the bank’s brand ambassadors Aamir Khan and Kiara Advani.
“The forthcoming festive season will lend further support to the picked-up momentum in the spends and new customers sourcing. However, a possible Covid 3.0 remains a key risk. We continue to believe that Citi Bank’s exit from the credit cards business along with the domestic corporate loan recovery cycle yet to pick up, provides good growth opportunities for the credit cards business, supported by improving macro-conditions,’ Axis Securities said in a note.
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This fund has been in existence for the last 8 years and the 1-year returns of the Quant Tax Plan Direct-Growth are 79.62 percent. It has returned an average of 21.94 percent every year since its inception. The fund has a lower expense ratio of 0.50% and SIP in this fund can be started with a minimum contribution of Rs 500. The fund has equity sector allocation across Financial, Construction, FMCG, Metals, Energy sectors.
Reliance Industries Ltd., Vedanta Ltd., State Bank of India, ITC Ltd., and HDFC Bank Ltd. are the fund’s top five holdings. The fund’s NAV as of September 20, 2021 is Rs 220.17. The fund has Rs 368.44 crore in assets under management (AUM). This fund has no exit load, and investments up to Rs 1,5 lakh are tax-free under section 80C of the Income Tax Act, with returns are taxable at a rate of 10%.
This ELSS mutual fund scheme has been in existence for the past 8 years and the last 1 year’s BOI AXA Tax Advantage Direct-Growth returns reached 64.13 percent. It has returned an average of 19.70 percent every year since its inception. The fund levies a 1.66 percent expense ratio, which is more than most other funds in the same category. The Financial, Technology, Chemicals, Healthcare, and Services sectors account for the majority of the fund’s holdings.
ICICI Bank Ltd., HDFC Bank Ltd., Infosys Ltd., Divi’s Laboratories Ltd., and Bajaj Finance Ltd. are the fund’s top five holdings. With a minimum contribution of Rs 500, you may start a SIP in this fund. As of September 20, 2021, the fund’s NAV is Rs 112.77 and the fund’s asset under management (AUM) is Rs 512.07 crore. There is no exit load on this fund.
This ELSS fund was launched by the fund house IDFC Mutual Fund, and thus has been in existence since January 2013. The fund is a medium-sized fund in its category, with an expense ratio of 0.85 percent, which is lower than the expense ratio charged by most other ELSS funds. According to Value Research, IDFC Tax Advantage (ELSS) Direct Plan-Growth returns for the past year reached 68.05 percent, with an average yearly return of 18.86 percent since its debut.
The fund has its equity exposure across Financial, Technology, Automobile, Construction, FMCG sectors. IDFC Tax Advantage Direct Plan Growth fund’s top 5 holdings are in ICICI Bank Ltd., Infosys Ltd., State Bank of India, HDFC Bank Ltd., Deepak Nitrite Ltd.. SIP in this fund can be started from Rs 500 and NAV of the fund as of 20th September is Rs 101.00 and asset under management (AUM) of the fund is Rs 3,338.88 Cr. The fund has no exit load but it charges a stamp duty fee of 0.005%.
Here are the best ELSS funds to invest in 2021 based on past performance and ratings from different agencies.
| Funds | 1-month returns | 6-month returns | 1-year returns | 3-year returns | 5-year returns | Rating by CRISIL | Rating by Value Research | Rating by Morningstar |
|---|---|---|---|---|---|---|---|---|
| Quant Tax Plan Direct Growth | 6.36% | 34.06% | 79.62% | 32.06% | 24.00% | 1 | 5 | 5 |
| BOI Axa Tax Advantage Fund Direct Growth | 5.88% | 29.86% | 64.13% | 25.42% | 21.41% | 1 | 4 | 5 |
| IDFC Tax Advantage Direct Plan Growth | 5.15% | 23.88% | 68.05% | 18.65% | 18.16% | 1 | 4 | 4 |
The views and investment tips expressed by authors or employees of Greynium Information Technologies, should not be construed as investment advice to buy or sell stocks, gold, currency, or other commodities. Investors should certainly not take any trading and investment decision based only on information discussed on GoodReturns.in We are not a qualified financial advisor and any information herein is not investment advice. It is informational in nature. All readers and investors should note that neither Greynium nor the author of the articles, would be responsible for any decision taken based on these articles. Please do consult a professional advisor. Greynium Information Technologies Pvt Ltd, its subsidiaries, associates, and authors do not accept culpability for losses and/or damages arising based on information in GoodReturns.in
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Overall bank lending could drop during this fiscal as corporate loan demand slumps and other sources of borrowings emerge.
Bank credit flow during April to August has shrunk over the same period a year ago, according to data from the Reserve Bank of India. This is despite the private-sector lenders such as HDFC Bank and ICICI Bank reporting double-digit growth in lending in the first quarter.
The overall fund flow into the economy grew by 10% in FY21 despite the pandemic. However, the incremental bank lending shrank 1.6% in FY21, while non-bank sources grew 30%.
Corporates reluctant
Banks are hoping for a lending spurt with the revival of capital expenditure, but it remains doubtful due to uncertainty over Covid.
Also, corporates are looking at cheaper avenues for funds. They raised Rs 1.8 lakh crore from the bond market this fiscal so far. Foreign direct investment and ECB have been also been strong, which has been bad news for banks. The buoyant equities market has seen corporates raising over Rs 1 lakh crore from the avenue during this fiscal till August.
In July
The total outstanding loans to large industries by the banking sector has shrunk for the 11th straight month in July 2021 as companies continue to deleverage and shift to cheaper options such as bonds. Most of the bank credit is driven by the retail and agri segments as sanctioned limits of corporates remain unutilised to the extent of 25%. The credit to large industries shrank 2.9% in July.
The credit growth in the last two months is being led by is led by MSMEs, agriculture and retail as corporate lending stays tepid.
PSU banks hit
The deleveraging has led to a drop in corporate loan demand for banks, especially PSU ones.
The domestic corporate loans by the State Bank of India fell 2.23 per cent to Rs 7,90,494 crore in the quarter ended June 30, 2021, compared to Rs 8,09,322 crore in the same quarter last year. In the first quarter of FY21, SBI reported 3.41 per cent growth in corporate advances.
Union Bank of India‘s share of industry exposure in domestic advances dropped to 38.12 per cent at Rs 2,40,237 crore from 39.4 per cent at Rs 2,47,986 crore in the same quarter a year ago. Corporate loans dropped 3% at Indian Bank during the last quarter. At PNB, corporate loans fell 0.57 per cent at Rs 3,264,66 crore in June quarter 2021 compared to Rs 3,28,350 crore a year ago.
Retail front
Banks, which have been relying on the retail sector, are facing competition. Non-banking financial companies that were reeling after the collapse of IL&FS have bounced back and emerged out of the pandemic relatively less hurt. Banks are facing competition from fintech firms, which have made borrowing a seamlessly easy experience.
with the advent of account aggregators, transaction details of borrowers can be open to lender, which may lead to poaching of customers.
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PayNearby on Tuesday said its enterprise offering that facilitates ‘cash collection’ as a service has crossed ₹350 crores worth transactions in monthly Gross Transaction Value (GTV).
The company offers cash collection as a service to over 50 clients across sectors such as NBFC, microfinance (MFI), OTTs, food delivery aggregators, cab aggregators, FMCG, and logistics among other digital services. However, a large section of their current portfolio is dominated by NBFCs and MFIs.
Also see: Auto debit transactions: Bounce rates in August near pre-second wave levels
“Our retail partners have served as cash disbursal points and are now outlets for secure cash disposal. While our collection process is seamless, it also gives companies deep in-roots to areas that were not serviced earlier,” said Anand Kumar Bajaj, Founder, MD and CEO, PayNearby.
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“Housing is much more affordable today than it ever was. In the last couple of years, property prices have more or less remained the same in major pockets across the country while income levels have gone up,” said Renu Sud Karnad, managing director, HDFC Ltd.
Record low interest rates, subsidies under PMAY and the tax benefits have also helped, she said.
“Customers can avail HDFC Home Loan starting at 6.70 per cent per annum effective September 20, 2021. This offer will be applicable to all new loan applications irrespective of the loan amount or employment category,” HDFC said in a statement.
The special festive offer at 6.70 per cent is for all loan slabs and for all customers with credit score of 800 and above.
Before this special offer, the rate for salaried customers for loan above Rs 75 lakh and credit score of 800 and above was 7.15 per cent and for self employed was 7.30 per cent.
Hence, effective cut for these customers could be up to 45 bps for salaried and up to 60 bps for self employed.
The special rate is linked to borrower’s credit score, it said, adding that this is a close ended scheme and will be valid till October 31.
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Ajit Prasad Press Release: 2021-2022/895 |
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Pension regulator PFRDA’s board has given the nod to award licences to Tata Asset Management Company and Max Life Insurance to become sponsors of a pension fund to manage the National Pension System (NPS).
The letter of awarding licences, however, is yet to be formally sent to both of them, said sources close to the development.
Once the licence-award process is completed, there will be 10 Pension Fund Managers in the country to manage the NPS. It maybe recalled that Tata Asset Management Company was among the 10 applicants who had responded to PFRDA’s Request for Proposal (RFP) for the selection of sponsors of pension funds.
Post the RFP, eight fund managers, including Axis Asset Management (new one), were awarded licences this year. The other seven were the pension arms of SBI, UTI, LIC, ICICI, HDFC, Aditya Birla SunLife and Kotak. All these seven were fund managers of NPS in the erstwhile regime.
Besides throwing open the door to more pension fund managers, the RFP had introduced at least five-fold jump in their fees, making it lucrative to undertake this activity.
The revamp of the pension funds management structure is part of PFRDA’s efforts to position the industry for strong decadal growth that could take the overall assets under management (AUM) of NPS to ₹30-lakh crore by 2030.
As of last week, India’s pension AUM had crossed the ₹6.5-lakh crore mark. With India’s pension assets growing at a frenetic pace of over 30 per cent, the PFRDA expects the overall AUM at this growth rate to touch ₹30-lakh crore by 2030. By March-end 2022, PFRDA expects pension AUM to touch ₹7.5-lakh crore.
Meanwhile, PFRDA is expected to firm up by this month-end the consultant who will help design a Minimum Assured Return Scheme (MARS) under the National Pension System, said sources.
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The Reserve Bank of India (RBI) on Monday announced that it would conduct open market purchase of Government Securities (G-Secs) under its “G-Sec Acquisition Programme (G-SAP) 2.0” along with a simultaneous sale of G-Secs on September 23.
So far, under G-SAP, the RBI has only conducted standalone G-Sec purchases. But this time round, it is simultaneously conducting sale of G-Secs in view of ample liquidity in the banking system.
RBI will purchase three G-Secs of seven to 14 years tenor, aggregating ₹15,000 crore, under G-SAP 2.0 on September 23.
Simultaneously, the central bank will sell three short-term G-Sec, all maturing in 2022, aggregating ₹15,000 crore.
In the second quarter so far, the RBI has bought G-Secs aggregating ₹90,000 crore in four G-SAP auctions. After the September 23 G-SAP auction, it may conduct one more auction for ₹15,000 crore.
Marzban Irani, CIO-Fixed Income, LIC MF, said the simultaneous conduct of G-Sec purchase under G-SAP and sale of G-Sec will be liquidity neutral. However, it may push up short-term yields.
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