Category: Personal Finance

Millennial users want Netflix, Amazon experience in broking apps, says brokerage honchos, BFSI News, ET BFSI

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The pandemic has forced the brokerage industry to reassess all the business models and their respective go-to-market strategies, which is leading to either an extreme or a moderate disruption, said Bhawna Agarwal Country Head, India – Strategy & Growth, Enterprise Group, HPE India.

“One common theme across all business adoption or acceleration of digital is that it has become completely pervasive. So, all across the section of clients for us, especially the stock brokers, we’re adopting this fast digital way of interacting as well as investing,” she said at the panel discussion on Brokerages Fighting Disruption Digitally at ETBFSICXO

Rising expectations

Sandeep Bhardwaj, CEO, IIFL Securities feels that after using Netflix or Amazon, people don’t differentiate between a banking application or a broking application. “They feel like a broking apps should be like that. This is where it becomes challenging for any brokerage to bring that experience. UI, UX gives millennial users an experience of their taste,” he said.

Millennial users want Netflix, Amazon experience in broking apps, says brokerage honchos
The whole ecosystem we’re working on for catering to the needs of the new generation needs everything to be faster, quicker, better and simpler, said Jaideep Arora, CEO, Sharekhan.

“Our entire digital platform team has an average age of 26 years, so when they know for whom they are making a product, they end up creating the same scenario for them. So that is what we are trying to do to get that seamless experience,” Bhardwaj of IIFL Securities said.

Millennial users want Netflix, Amazon experience in broking apps, says brokerage honchos
A lot of data is being used to really understand how we give the right advice to the right customer in the best manner possible. So basically there’s a digital innovation happening in the account opening onboarding process, said Arora.

“Mixing behavioural science with the technology to leverage is what the entire solution is all about at the end of the day. How we create a user experience, leveraging AI and ML will define the user lifecycle throughout his life,” said Bhardwaj.

Collaboration with FinTechs

Digital is all about collaboration with FinTechs. Rather than building everything in-house and spending money, it’s all about collaborative work. So it becomes far easier to implement those solutions which are readily available, says Bhardwaj.

Having a very collaborative opensource and working with FinTechs and even smart customers and coming with a lot of solutions can help the whole system, and it will be a win-win across the industry, said Arora of Sharekhan.

Millennial users want Netflix, Amazon experience in broking apps, says brokerage honchos
“In this ecosystem, the learning is that you are not alone, you have to collaborate with FinTechs, you need to have rich API’s, engage with other partners and customers as well. You have to cover all aspects of digital transformation at all levels and really immerse into it, and then you truly grow. This is what our belief is,” he said.



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Subhash Garg, former Finance secretary, BFSI News, ET BFSI

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Subhash Chandra Garg, Former Finance Secretary, gives his view on the govt’s new monetisation pipeline. Edited excerpts from his interview with ET Now’s Tamanna Inamdar:

Tamanna Inamdar: How do you view the govt’s new asset monetisation plan in light of past experiences?
Subhash Chandra Garg: Monetisation has two clearly stated objectives which are very worthwhile.

One, you have invested some money in road or airport or rail or whatever, and now you need more money to invest. Therefore, the asset which has been created is passed on to private entrepreneurs to operate it, and then take that capital back to invest into something new.

Two, better operation of an asset. A toll road operated by NHAI or an airport operated by AAI or an electricity distribution company run by a state entity gets better operated if it is operated by private entity.

There is immense sense in monetising operating assets. There is lot of confusion and unnecessary misinformation that monetisation is sale of assets, which it is not. And sale of asset is not a bad thing. I do not think the government should be defensive about it.

There is no need to be defensive about selling banks, insurance companies, BPCL etc. That is a different route which should be taken to its logical course. What can get appropriately sold should be sold and monetised. There is nothing wrong about it. It is a perfectly justifiable thing to do.

One concern is over who gets these assets. Can it create monopolies with these going into the hands of a few, like people fear?
In India, operating of important assets is too much decentralised. There are actually too many operators. There is a necessity for large efficient players to run road assets or airport assets.

For example, buses and trucks in many states have single owners. They cannot invest, they cannot maintain those assets. Same is the case with the government. The Airport Authority of India has over 130 airports, but it cannot maintain them well.

There are 5 to 10 good operators in the country and three or four very good airport operators. Only about 20 airports are at best going to or have gone into private hands. So I think this concern over monopolies is completely misplaced.

India is a very large country with a huge number of entrepreneurs. We should only actually consolidate. Take example of telecom. There are three operators. Does it serve the country’s interest badly? Should there be 20-25 telecom operators?

The same thing applies to roads or rail. If we have 5, 10 or 20 strong players, I think we will be better off. This concern is overblown. I do not think it is in national interest to be worried about potential monopolies.

Similar plans in the past haven’t had roaring success. What is your take on this particular plan?
That is where the main challenges lie. The government did very well in monetisation of six airports in 2019, but thereafter there hasn’t even been a single transaction.

In roads also, we have struggled. There have been only five packages so far of ToT. Two of them did not take off at all in last five years; we have only done three. There is not much success anywhere else.

Now, this particular plan which talks of Rs 6 lakh crore over four years — that is Rs 1,50,000 crore a year — is simply too ambitious. I do not think there is any likelihood of it getting done. The institutional mechanisms which we have created are also not at all conducive for this to happen.

I honestly think that the government will not be able to deliver on it. If it does even 20% of what it is saying, I would be very happy.

When the government comes up with these mega pipelines — infrastructure pipeline earlier, monetisation pipeline now — the numbers are staggering, very big. There is absolutely no capacity, no clarity of structure. The sheer inability and the record of the government in carrying out such transactions makes me very suspicious.

As I said, I do not see more than 20% of it being met. My estimate is that the government, in four years, will end up with only 10% of this pipeline being achieved.

That would be 60,000 crore. Not more than that.



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BFSI CEOs look to unlock business value as pandemic ebbs, BFSI News, ET BFSI

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After almost two harrowing years of the pandemic, bank chief executives are looking ahead for a period of stability and growth with predictions of an uptick in credit demand.

Sanjay Singh, Deputy CEO, BNP Paribas India

Sanjay Singh, Deputy CEO, BNP Paribas India

“All the factors are favouring the capex revival. Low interest rates, lower leverage, efficient ecosystem, and demand uptake. All are indicating that capex will resume in next six months,” Sanjay Singh, Deputy CEO, BNP Paribas India, said at the CEO Panel discussion BFSI Leaders: Unlocking Business Value at ETBFSI Summit.

Singh said his bank’s focus is to embrace the best of traditional banking and a mix of new-age technologies.

Rajeev Yadav, MD & CEO, Fincare Small Finance Bank
Rajeev Yadav, MD & CEO, Fincare Small Finance Bank

Rajeev Yadav, MD & CEO, Fincare Small Finance Bank

Focus on risks

Along with growth and revival, bankers are also focused on risks.

Risk taking in the post pandemic world is a very important factor for all. Retail lending is a safer bet than corporate, said Rajeev Yadav, MD & CEO, Fincare Small Finance Bank. “Being a retail bank, we are taking retail risk. Retail lending is stabilised and fear of incremental lending is no more there,” he said.

Sunil Prabhune, Chief Executive-Rural & Housing Finance and Group Head-Digital, IT & Analytics, L&T Financial Services
Sunil Prabhune, Chief Executive-Rural & Housing Finance and Group Head-Digital, IT & Analytics, L&T Financial Services

Sunil Prabhune, Chief Executive-Rural & Housing Finance and Group Head-Digital, IT & Analytics, L&T Financial Services

Sunil Prabhune, Chief Executive-Rural & Housing Finance and Group Head-Digital, IT & Analytics, L&T Financial Services said that the business metrics have changed and the vaccination of employees is now an integral factor.

“Liquidity is not a problem anymore. We are extra conscious about risks and are focusing on how to retain customer franchise by maintaining the relation without meeting the customer. The strategy is to use data intelligence rather than conventional wisdom or rule of thumb for decision making,” he said.

During the pandemic it’s okay to miss top-line success because survival is the major objective, Yadav of Fincare said. “Shouldn’t worry about any loss of GDP or growth. As compared to 2019 data we are doing better,” he said.

On growth

Bank CEOs see a lot of pent-up demand.

“On an average credit demand is muted but there are pockets where demand is thriving. Use of behavioral analytics, machine learning, tailoring asset strategy etc. has helped us to recover faster, said Prabhune of L&T Financial Services, adding that his company’s disbursement this quarter was 3-3.5 times of the last quarter.

Nitesh Ranjan, ED, Union Bank of India
Nitesh Ranjan, ED, Union Bank of India

Nitesh Ranjan, ED, Union Bank of India

Nitesh Ranjan, ED, Union Bank of India said credit demand is subdued right now but definitely recovering from what is seen in the last six months across the spectrum. “Push from the government will help. The demand is high in Agri, renewable energy, Infra and warehousing,” he said.

“In the new normal world, we look at data and decide business operations. We are a rural bank and our rural business is shaping up better than pre-Covid,” Yadav of Fincare said,

Covid didn’t have any impact on businesses that are part of essential services, i.e. agri, dairy, he said, adding that credit demand is reasonably strong.

Future trends

The focus is on the next 3-5 years, how to better leverage digital and data, how to build capacity to manage people and continuously invest in the right risk architecture, said Ranjan of Union Bank of India.

Can banks build their own super app since they have a large customer base, asked Anand Dalmia, Co-founder, Fisdom. “With a super app, banks can offer more service to customers,” he said.

Prabhune of L&T Financial Services said “Monitoring is not something when it’s going wrong. Our focus is to detect what is something like to happen rather than what has happened. Can we predict if a customer is going to delay his payment for a day?”

Yadav of Fincare wants to focus on basic banking objective which the bank missed due to the pandemic. “We would like to have in-house talent rather than depending on the others,” he said.

Learnings from Covid

Ranjan said the PSU bank merger was a major challenge along with Covid. “Overnight we doubled the size. But we are seeing a much better period than what we have seen. With vaccination, we will be in a better place and business continuity is also improving.”

All of us had plans for 3-5 years. Covid taught us to accelerate the plans to one year.

Dalmia of Fisdom said during the pandemic FinTechs gained a lot due to digital adoptions by banks. We focused on getting more partners onboard. “We have collaborated with 10 banks. Banks have many retail customers, which is beneficial for FinTechs.”



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Barclays to invest more than $400 million to expand India operations, BFSI News, ET BFSI

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Barclays Plc will invest more than Rs 3,000 crore ($403.99 million) in its India unit to expand operations, the British lender said on Thursday.

With the investment, Barclays Bank PLC India’s total invested capital in Asia’s third-largest economy will increase to more than Rs 8,300 crore.

Barclays said the investment would help grow its corporate and investment banking, and private clients businesses in the country.

“As economic activity gathers momentum, there is increased demand for capital from clients,” said Jaideep Khanna, head of Barclays, Asia Pacific and Country CEO, India.

Barclays Bank PLC had inaugurated its International Banking Unit branch at GIFT City in Gujarat in February.

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MoS Anupriya Patel, BFSI News, ET BFSI

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NEW DELHI: Union Minister of State for Commerce and Industry Anupriya Patel on Monday said that India is expected to export USD 46 billion to ASEAN in the financial year 2022.

Patel on Monday inaugurated the “India-ASEAN Engineering Partnership Summit” organised by the Engineering Exports Promotion Council (EEPC) with support from the Ministry of External Affairs and the Department of Commerce.

While addressing the inaugural session, Patel said: “As one of the largest destinations for Indian exports, ASEAN will be an important region for India with an export target of USD 46 billion in meeting the global export target of USD 400 billion in the financial year 2021-22.”

“Both India and ASEAN have large share of skilled population, robust service and manufacturing sectors and there are many complementary sectors and products available for greater cooperation. With a combined economy of approx. USD 5.8 trillion, there is significant potential for enhancing trade and investment partnership between India and ASEAN.”

Patel further said that Prime Minister Narendra Modi has set a target of USD 400 billion of merchandise exports for fiscal 2021-22 and also envisioned a roadmap to achieve this milestone.

“As a part of the Atmanirbhar Bharat Abhiyaan, the Central government has recently approved the Production-Linked Incentive (PLI) Scheme worth USD 26 billion covering 13 sectors, including electronics, pharmaceuticals, solar modules, speciality steel, automobiles, and medical devices for attracting investment and enhancing India’s manufacturing capabilities,” she said.

Supported by the Ministry of Commerce and Industry and Ministry of External Affairs, the four-day India-ASEAN Engineering Partnership Summit is expected to see the participation of over 300 delegates from the Indian industry. A sizable number of delegates from ASEAN countries will also join the summit. The summit will also cover B2B meetings and interactions. The thematic sessions will cover a range of topics including country sessions, and emerging areas of cooperation like Industry 4.0, integration of MSME in the regional value chain. The Government of Tamil Nadu joined the event as “Partner State” while the Government of Haryana as the “Focus State”.

This year is special for both partners as it marks the 25thanniversary of the India-ASEAN dialogue partnership and 10 years of the Strategic Partnership.

An E-Book on India-ASEAN trade and investment emphasizing the engineering and MSME sector was also launched during the inaugural session. The book covers several important aspects of enhancing bilateral trade and investment and also provides exhaustive information on India and ten ASEAN nations.



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4 NSE PSE Stocks With High Dividend Yield Up To 10%

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Indian Oil Corporation

Indian Oil Corporation Limited, also known as IndianOil, is a government-owned company in India. It is owned by the Ministry of Petroleum and Natural Gas of the Government of India, which is based in New Delhi. As of 2021, the government firm is placed 212nd on Fortune’s Global 500 list of the world’s largest enterprises. With a net profit of $6.1 billion for the fiscal year 2020-21, it is the country’s largest government-owned oil firm.

Dividend History

Since August 27, 2001, Indian Oil Corporation Ltd. has declared 33 dividends. Indian Oil Corporation Ltd. has declared an equity dividend of Rs 12.00 per share in the last 12 months. At the current share price of Rs 106.35, this equates to an 11.28 percent dividend yield.

Coal India

Coal India

Coal India Limited (CIL) is a coal mining and refining company controlled by the Indian government. It is owned by the Ministry of Coal of the Government of India, which is based in Kolkata, West Bengal, India. It is the world’s largest coal producer and a Maharatna public sector initiative. India’s coal resources are estimated to be in excess of 326 billion tonnes. The reserves are sufficient to meet the demand for several centuries at the current rate of production.

Dividend History

Since February 18, 2011, Coal India Ltd. has issued 18 dividends. Coal India Ltd. has declared an equity dividend of Rs 12.50 per share in the last 12 months. This translates to a dividend yield of 9.0 percent at the current share price of Rs 138.85.

Power Finance Corporation

Power Finance Corporation

Power Finance Corporation is an Indian financial corporation that is owned by the Indian Ministry of Power. It is the financial backbone of the Indian power sector, having been established in 1986. The corporation, which was initially completely owned by the Indian government, became public in January 2007. The IPO was oversubscribed by more than 76 times, making it one of the largest for an Indian company’s initial public offering.

Since September 7, 2007, Power Finance Corporation Ltd. has declared 27 dividends.

Power Finance Corporation Ltd. has declared an equity dividend of Rs 10.00 per share in the last 12 months. This equates to a dividend yield of 7.95 percent at the current share price of Rs 125.85.

REC

REC

In India’s power industry, REC Limited, originally Rural Electrification Corporation Limited, is a public Infrastructure Finance Company. The firm is a government-owned corporation that finances and promotes power projects throughout India.

The company lends to the country’s Central/State Sector Power Utilities, State Electricity Boards, Rural Electric Cooperatives, Non-Governmental Organizations, and Private Power Developers.

Dividend History

Since September 8, 2008, REC has paid out 27 dividends. REC Ltd. distributed an equity dividend of Rs 13.00 per share in the previous 12 months. This amounts to a dividend yield of 8.95 percent at the current share price of Rs 145.25.

4 NSE Stocks With High Dividend Yield Up To 10%

4 NSE Stocks With High Dividend Yield Up To 10%

Company Last Traded Price Dividend Yield
IOC 106.35 11.28%
Coal India 138.85 9.0%
REC 145.25 8.95%
Power Finance Corporation 125.85 7.95%

Disclaimer

Disclaimer

Investing in stocks has the risk of financial loss. As a result, investors must proceed with prudence. Any losses incurred as a result of decisions based on the article are not the responsibility of Greynium Information Technologies, the author, or the brokerage houses. Due to the fact that Sensex has now crossed 55,500 points, investors should exercise caution.



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NSE directs its members to stop sale of digital gold by Sept 10, BFSI News, ET BFSI

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New Delhi: National Stock Exchange (NSE) has directed its members, including stockbrokers, to discontinue the sale of digital gold on their platforms by September 10. The direction came after capital markets regulator Sebi said that certain members are providing a platform to their clients for buying and selling digital gold.

Securities and Exchange Board of India (Sebi), through a letter dated August 3, informed the exchange that the said activity is in contravention of Securities Contracts (Regulation) Rules (SCRR), 1957, and the members should refrain from undertaking any such activities.

The SCRR rules restrict all members from engaging, either as principal or employee, in any business, other than that of securities or commodity derivatives, except as a broker or agent, not involving any personal financial liability.

Accordingly, NSE directed members not to carry out such activity and comply with the regulatory requirements at all times.

“Members, currently engaging in the activity, shall cease to undertake all activities in this regard, within one month from the date of this circular during which necessary communications, regarding the discontinuation, shall be made to the respective clients,” NSE said in a circular dated August 10.

TradeSmart Chairman Vijay Singhania said digital gold units are not issued by any regulated entity. There is no method to check whether the digital gold certificate is backed with physical gold or not.

Some jeweller firms like Titan and banks were known for selling digital gold.

Digital gold does not come under the definition of securities as defined in the Securities Contract (Regulations) Act 1956.

“The circular prohibits the dealing/offering digital gold-selling via Sebi registered entities, as it is not a security as mentioned above. It may be continued to be sold by the unregulated entities, subject to RBI directions if any,” Singhania said.

Kishore Narne, Head of Commodities & Currencies, Motilal Oswal Financial Services, said, “We were distributors of the digital gold product of MMTC-PAMP, with the backdrop of exchange issuing the directives for such product to be not sold by all stockbrokers of the stock exchange; we shall be discontinuing distribution of this product”.

According to him, MMTC-PAMP will continue to be the owner of the product and retain all the holdings of gold on behalf of clients and shall be offering all the redemption and sell-back options for all the existing clients.



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Bank employees’ pension pay-out hiked to 30% of last-drawn pay, BFSI News, ET BFSI

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Finance minister Nirmala Sitharaman detailed the way ahead for India’s public sector banks as part of her government’s EASE 4.0 policy. EASE 4.0 or Enhanced Access and Service Excellence is the Centre’s reform agenda of public banks aimed at institutionalising clean and smart banking.

Sitharaman met heads of PSBs to review financial performance of the lenders and progress made by them to support the economy battered by COVID-19 pandemic.

At the presser post launch in Mumbai, Finance Secretary Debashish Panda announced changes to the pension pay-outs of Public Sector Banks.

The changes instituted are set to increase the pension pay-out to bank employees, with all of them set to get an even 30% of their pay. The Centre has also asked banks to increase the employer contribution to the pension corpus to 14%, from the current 10%.

“Pension pay-outs to bank employees could increase to Rs 30,000-Rs 35,000 from the earlier cap of Rs 9284,” Panda said.

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Finance minister, BFSI News, ET BFSI

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MUMBAI: Union finance minister Nirmala Sitharaman on Wednesday said it is too early to say if there is a lack of demand for credit and announced a district-wise outreach to be undertaken by banks to help credit growth from October.

A push to credit growth from such outreach efforts will also help the momentum set by the stimulus packages, which have been extended by the government since the onset of the pandemic.

It can be noted that in late 2019, banks had conducted the “loan melas” in 400 districts to push up sagging credit growth. Even now, the credit growth is stuttering at around 6 per cent.

“I think it is too early to conclude whether there is a lack of demand… I don’t think it is time yet to conclude that there is no credit pick-up. Even without awaiting indications, we have taken steps to ramp up credit,” Sitharaman told reporters here.

She noted that over Rs 4.94 lakh crore was disbursed by the banks between October 2019 and March 2021 through the outreach initiatives undertaken by them.

“This year too sometime in October, there will be a credit outreach in every district of the country,” she said.

Sitharaman added that the government had announced that credit up to Rs 1.5 lakh will be given to borrowers through NBFC-MFIs.

“In order to keep up the momentum of stimulus that we are periodically giving, we have also asked banks to go out and give credit,” she said.

Meanwhile, Sitharaman said there is a need to ramp up credit growth in the eastern pockets of the country in states like Jharkhand, West Bengal, and Odisha, where the populations are displaying a higher propensity to deposit money in current and savings accounts.

Banks have also been asked to create state-wise plans for northeastern states to help the logistics sector and exporters.

Apart from that, Sitharaman, who took a review meeting with the chiefs of all the 12 state-run lenders, said banks have been asked to reach out to exporters at the district level to help push the “one district, one export” message of Prime Minister Narendra Modi.

Besides, the finance minister said banks have also been asked to look into the demands of the fintech sector.



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FM asks India Inc to look beyond banks for finance, BFSI News, ET BFSI

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Mumbai: Finance minister Nirmala Sitharaman told India Inc on Tuesday that there is a move to enable the industry to meet its funding needs from markets rather than banks. Among alternate financing measures, the government is looking at allowing insurance bonds instead of bank guarantees, a senior government official said.

In her first visit to Mumbai after the second wave of the pandemic, the finance minister addressed industry leaders at a Confederation of Indian Industry (CII) interaction on Tuesday evening. Later, she attended a dinner meeting with industry chiefs, including Tata Group chairman N Chandrasekaran.

The FM said that industry dependence on banks would be further reduced by the operationalisation of the new development finance institution, which will take over long-term lending and also provide competition to banks. The FM emphasised the need for government and industry to work together to “create India’s own equity capital”.

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