In a few years time from being a mid-sized company, this family business group has surpassed the likes of Tatas, Birlas and Wadias among others to become one of the richest in India. Now, the group company is close on the heels of even overtaking Mukesh Ambani, who owns the oil to telecom conglomerate Reliance Industries.
This Group Company Stocks Gave Up To 1064% Return In The Last One Year
Yes you are right, here we are referring to Gujarat based Adani Group of companies, with six companies listed on the Indian bourses.
The list of group’s listed entity includes Adani Transmission, Adani Total Gas, Adani Enterprises, Adani Ports and SEZ, Adani Power and Adani Green Energy.
As per the latest World’s Real time Billionaires 2021 list, while Mukesh Ambani commands a net worth of $76.6 billion, Adani is not far behind with total wealth at $69 billion.
Year to date wealth addition by Gautam Adani
On a year to date basis, Adani added almost Rs. 75 crore on an hourly basis.
Adani Group’s increasing focus on infrastructure
The success or massive wealth addition by Gautam Adani is largely the result of his increasing focus in the area of infrastructure. In the last 2 years, the company made an acquisition of Rs. 50,000 crore, while Rs. 25000 crore was in the last year alone.
Last year, Adani bought 74% stake in the Mumbai International Airport, the country’s busiest airport and also sold 20 percent holding in Adani Green to Total in another development for $2.5 billion.
Now even as the companies across India Inc. continued to bore the brunt due to the pandemic, the Adani group companies’ share price soar to even up to 11 times i, with their individual stock market cap rising manifolds.
Surge in M-cap of Adani Group companies
The Adani Group companies’ total market at around the same time last year was at Rs. 1.64 lakh crore which now has surged to more than Rs. 8.5 lakh crore, an increase of over 420 percent.
Here’s given a quick guide how the Adani Group stock prices moved over the last year:
Adani Group company
Stock price on May 26, 2020
Stock price on May 26, 2021
% gains in last one year
Adani Green Energy
Rs. 240
Rs. 1264
426%
Adani Transmission
Rs. 178
Rs. 1392
682%
Adani Total Gas
Rs. 114
Rs. 1327
1064%
Adani Ports
Rs. 315
Rs. 758
140%
Adani Enterprises
Rs. 140
Rs. 1322
844%
Adani Power
Rs. 37
Rs. 99
167%
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The year-on-year gross bank credit growth to MSEs in March had declined to its lowest level, amid the second Covid wave, since May in the financial year 2020-21.
Gross non-performing assets of banks are likely to decline in FY21 due to restructuring, write-offs, and resilience in the economy, rating agency CARE Ratings said on Wednesday. The decline is expected as several regulatory and government support schemes for MSMEs and others had helped borrowers to access liquidity and conserve cash flows. For instance, the moratorium on loan repayments for six months till August 30, 2020, Covid-related restructuring scheme for MSMEs till March 31, 2021, and for large corporates till December 31, 2020, Resolution Framework 2.0 scheme for personal loans and MSMEs till September 30, 2021, ECLGS to enable banks and NBFCs provide funding to MSMEs, TLTROs, special refinance facilities to NABARD/SIDBI/NHB to address sectoral credit needs, and extended partial guarantee scheme, the agency noted.
“The government had enabled loan of up to 20 per cent of an MSME’s total outstanding credit in the Rs 3 lakh crore ECLGS scheme. So, loans were guaranteed by the government and MSMEs got significant breathing space with immediate cash flows being taken care of so that they may not default and deteriorate their credit score, etc. Given that MSMEs generally have a significant share of NPAs, now that share will be much more muted than what we would have expected otherwise,” Sanjay Agarwal, Senior Director, CARE Ratings told Financial Express Online.
Gross NPAs had jumped by 43.7 per cent from Rs 7.1 lakh crore in March 2017 to reach Rs 10.2 lakh crore by the end of March 2018 following which the NPAs witnessed moderation and reached Rs 8.9 lakh crore by end of March 2020, the report said. The asset quality pressure witnessed by the banks over post asset quality review (AQR) had been reducing in a couple of years prior to Covid. The movement in gross NPA had declined to Rs 9 lakh crore in FY19 and to Rs 8.9 lakh crore in FY20.
Despite a challenging year (FY21), the quantum of gross NPAs of scheduled commercial banks (SCBs) is expected to decline by the end of March 2021 as compared with the previous year due to write-offs, lower slippage, restructuring schemes, and ECLGS support for MSMEs, the agency said in the report. However, as anticipated with the Supreme Court judgment allowing for the recognition of NPAs, FY21-end numbers are expected to be either similar or slightly above the Q3 FY21 numbers, it added. “Slippages are largely from MSMEs in retail. MSME slippages have been reduced because of the ECLGS,” added Agarwal.
The FY21 gross NPAs is estimated to settle at Rs 7.9 lakh crore, according to CARE Ratings. While public lenders’ gross NPA amount is expected to be around Rs 6.0 lakh crore at the end of March 2021 vis-à-vis Rs 6.8 lakh crore at the end of March 2020, for private lenders, the gross NPA amount increased from Rs 1.8 lakh crore in March 2018 to over Rs 2 lakh crore in December 2019. However, it is subsequently expected to have retreated to around Rs 1.96 lakh crore by the end of March 2021.
Moreover, write-offs’ share in gross NPAs has markedly increased post FY18, indicating that SCBs have cleaned their books taking a hit and recoveries have had a smaller share of the same, the agency said. “MSMEs right off every quarter by all banks has been very significant because the government had given quite a lot of equity and banks had made a lot of provisions. Now they have written off against the provisions. So it doesn’t reflect in the profit and loss statement but writes-offs are very significant,” said Agarwal.
Importantly, the year-on-year gross bank credit growth to MSEs in March had declined to its lowest level, amid the second Covid wave, since May in the financial year 2020-21. The credit outstanding as of March 26, 2021, was Rs 11.07 lakh crore – up only 2.5 per cent from Rs 10.8 lakh crore in March 2020, according to the RBI’s monthly bulletin. Moreover, the share of MSEs in India’s overall gross bank credit also continued to decline for the third straight month. From 12.11 per cent in December 2020, the MSE share contracted to 12.09 per cent in January 2021 and 11.8 per cent in February before slipping further to 11.3 per cent in March. The overall gross bank credit as of March 26, 2021, stood at Rs 97.2 lakh crore.
The Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), which is funded by the government, is a one-year life insurance policy that was started about six years ago. The nominee of the insured receives a payout of Rs. 2 lakh in the event of the insured’s death due to any cause.
If you have someone, especially the breadwinner, who lost the family member because of covid 19, ask the family to check whether the deceased has enrolled. Such plans can contribute to financial stability for a family which lost its breadwinner.
Each year the policy is renewed and the coverage is between June and May. The coverage starts from the requested date and concludes on 31 May next year. The account holder requests. The annual premium is Rs 330 if you sign up between June and August.
Claim settlement policy under PMJJY
The Rs.2,00,000 claim amount is payable to its nominee upon the death of a member (s). A person who is 18 years of age (full) will be granted the risk coverage from age 55 until the date of annual renewal. i.e. the eligibility ceases at the age of 55, or the closure of the bank’s account, or the lack of balance to enforce the insurance.
How can the nominee claim insurance under Pradhan Mantri Jeevan Jyoti Bima Yojana?
Step 1
Nominee to contact the Bank in which the member had a ‘Savings Bank Account’ covered by the PMJBY, with the member’s certificate of death.
Step 2: The nominee should keep ready documents such as claim form and refund receipt from the bank or other designated sources, including from designated websites, like branches of insurance undertakings, hospitals, Hospitals, PHCs, BCs, insurance companies, etc.
The insurance companies concerned shall guarantee that forms at all such places are widely available. No person asking the same shall be refused the supply of the form,
Step 3:
Nominee to send the duly filled claim form, receipt for discharge, the death certificate, together with a photocopy of the canceled bank account of the nominee (if available), or bank details to the bank where the member had a Savings Bank Account protected under PMJBY.
Bank to check the claims form, and to fill in the required fields of a claim form, the nominee’s information from the documents available to them.
The registration process was easy and straightforward. PMJJBY is managed in India by both the LIC and other private life insurance firms. If the bank is linked with insurance firms, you may be able to contact their particular bankers for the registration process. Even if a person has many bank accounts at one bank or another, he or she could not join the plan except via a bank account.
How to register for the Scheme of PMJJBY?
The registration process was easy and straightforward. PMJJBY is managed in India by both the LIC and other private life insurance firms. If the bank is linked with insurance firms, you may be able to contact their particular bankers for the registration process. Even if a person has many bank accounts at one bank or another, he or she could not join the plan except via a bank account.
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Debt mutual funds invest in fixed-income assets such as bonds and other debt instruments in order to maximise returns for investors. This determines the returns earned by mutual fund investors. Debt funds are excellent at meeting short-term investment objectives and have a low-risk ratio. Debt mutual funds are known to be much less risky than equity mutual funds as they invest in fixed income instruments. When you withdraw your debt mutual fund units within a three-year investment term, you get short-term capital gains. This income is applied to your taxable income and taxed as per your tax slab rate. Under section 111A, short-term capital gains on debt maintained for less than a year are taxed at the same rate as regular income. Long-term capital gains on debt maintained for more than a year are subject to indexation and are levied at a rate of 20% under section 10 (38).
Fixed Deposits
Individuals must pay tax on interest earned on bank fixed deposits. If the interest earned for the year exceeds a certain threshold which is Rs 50,000 in the case of senior citizens and Rs 40,000 in the case of non-senior citizens, banks are allowed to subtract TDS at a rate of 10% and the TDS rate on fixed deposit interest is 20% if you do not your PAN details to the bank. Senior citizens who seek a deduction must disclose on their tax return (ITR). Interest income must be recorded under the heading “Income from other sources,” and senior citizens can claim a deduction under Section 80TTB. You can submit Form 15G/15H if your gross income for the year is less than Rs 2.5 lakh. if your income does not slip within the taxable slabs, the bank will not subtract TDS and you will not be eligible to pay any tax. To stop the inconvenience of additional TDS deduction and ultimate refund from the IT Department, you must submit these forms at the beginning of each fiscal year.
National Savings Certificate
The National Savings Certificate is a government-backed fixed-income investment scheme that is provided by post offices. This debt instrument is suitable for investors who want to get fixed income returns along with tax benefits as it is a secure and low-risk product to bet on. The interest rate is revised quarterly and currently, NSC is promising an interest rate of 6.8% per annum. The principal deposited in NSC counts for tax benefits under Section 80C of the Income Tax Act up to Rs. 1.5 lakhs annually as any other tax saving schemes such as 5-year tax-saving fixed deposits.
Post Office Time Deposit
Under small savings schemes of the post office, the National Savings Time Deposit Account is identical to bank fixed deposits. Depositors can open a time deposit account for one, two, three, or five years. The Government of India adjusts the interest rate on post office term deposits per quarter. Interest is measured quarterly and paid once a year. This debt instrument currently offers a return of 5.5 per cent for 1 to 3 years and 6.7 per cent for 5 years. Only a 5-year post office time deposit account qualifies for income tax benefits. Investors will be entitled to claim tax benefits up to Rs.1.5 lakh under Section 80C of the Income Tax Act, 1961.
Senior Citizen Savings Scheme
The Senior Citizens Savings Scheme (SCSS) is a secure debt instrument only for senior citizens who are above 60 years of age. The scheme provides only secure returns but also allows to claim tax benefits, rendering it an excellent investment option. The interest rate on the Senior Citizen Savings Scheme (SCSS) for the first quarter (April-June) of FY 2021-22 is 7.4 per cent per annum. It is one of the highest interest rates among other small savings schemes. SCSS is liable for a tax deduction of up to Rs. 1.5 lakh per year under section 80C of the Income Tax Act. If net interest in all SCSS accounts in a fiscal year crosses Rs.50,000/-, interest is taxable, and TDS at the specified rate is deducted from the overall interest earned. If form 15 G/15H is submitted and the earned interest does not exceed the specified limit, no TDS will be deducted.
Public Provident Fund
Because of its many related advantages, the public provident fund (PPF) is a prominent investment fund among investors. It’s a long-term investment option that appeals to those who want to seek tax benefits while maintaining a steady interest income. Individuals with a low-risk appetite can consider a public provident fund scheme to invest for a 15-year of lock-in term. Since this scheme is backed by the government, it is accompanied by assured returns to meet an investor’s financial needs. The current PPF interest rate is 7.1 per cent, and it is subject to quarterly adjustments by the government. The Exempt-Exempt-Exempt (EEE) category includes a variety of investment vehicles, including the PPF. This means that the principal amount, the maturity amount, and the interest received is tax-free. It should be noted, though, that the maximum amount of money that can be invested is limited to Rs 1.5 lakh per annum.
Among the most widespread investment options is the fixed deposit (FD). Bank FDs are favoured by many investors over mutual funds because they are deemed safer. In contrast to mutual funds, the return on a bank FD is set and determined at the point of investment. The minimum and maximum terms on which an FD may be maintained differ from one bank to the other. FDs can usually be maintained for a minimum of seven days and a limit of ten years according to someone’s needs. So if you are willing to invest in fixed deposits for secure returns, here are the 5 banks that are currently promising higher interest rates.
3 Year Fixed Deposits
If you want to invest for medium-term then here are the 5 banks that are currently promising higher returns on 3-year deposits to both regular and senior citizens.
Banks
Regular FD Rates
Senior Citizen FD Rates
W.e.f.
Suryoday Small Finance Bank
7.00%
7.50%
15.02.2021
Ujjivan Small Finance Bank
6.75%
7.25%
05.03.2021
Equitas Small Finance Bank
6.65%
7.15%
25.01.2021
DCB Bank
6.50%
7.00%
15.05.2021
IndusInd Bank
6.50%
7.00%
26.04.2021
Source: Bank Websites, For deposits up to Rs 2 Cr
5 Year Fixed Deposits
Below are the 5 banks that are giving higher returns of 5-year deposits to both regular and senior citizens.
Banks
Regular FD Rates
Senior Citizen FD Rates
W.e.f.
Suryoday Small Finance Bank
7.25%
7.75%
15.02.2021
Ujjivan Small Finance Bank
6.75%
7.25%
05.03.2021
RBL Bank
6.60%
7.10%
07.05.2021
Yes Bank
6.50%
7.25%
10.05.2021
DCB Bank
6.50%
7.00%
15.05.2021
Source: Bank Websites, For deposits up to Rs 2 Cr
Conclusion
An investor’s risk tolerance standard influences his or her investment choices. Higher returns often come at a higher risk, which may imply risking a large sum of money in the future if the market turns against you. An optimal investment portfolio is a combination of risky and risk-free holdings that is tailored to an individual’s risk management capability and risk appetite. When it comes to risk-free investments and guaranteed returns, fixed deposit investments are a safe bet. It not only ensures secure returns, but it also ensures that your deposits are covered by the DICGC.
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This fund has been accorded a 5-star rating from CRISIL. The assets under management at Rs 17,000 crores is one of the highest in its category. The fund has given a returns of 78% in the last one year, while the 2-year returns is 24% and the 5-year returns is near 17%.
A similar rating of 5-star has been given to UTI Flexi Cap Fund from Value Research as well. Though the fund is mandated as flexi-cap most of the stocks among the top 5 are large cap stocks. The top 5 holdings of UTI Flexi Cap Fund is Bajaj Finance, HDFC Bank, L&T Infotech, HDFC and Kotak Mahindra Bank.
There are also stocks with a smaller market cap then the above, including names like Astral and Info Edge.
PGIM India Flexi Cap Fund
This fund is again well rated by Crisil as 5-star, though Value Research has given a rating of 4-star. Again, though the fund is largely flexi-cap, where a larger part of the top 5 holdings is tilted towards the large cap companies. This is a good strategy as many mid and small cap companies have rallied significantly over the last few quarters.
The fund has holdings in stocks like Infosys, ICICI Bank, State Bank of India, Axis Bank and Divis Labs. If you are looking at an SIP then the minimum investment is Rs 1,000 that would be required.
An SIP of Rs 10,000 over the last three years, would have helped create a corpus of Rs 5.74 lakhs today. The growth plan has an NAV of Rs 22.21 currently.
Kotak Flexicap Fund
This fund is another fund that has fared well over the last few years. In fact, Kotak Flexicap Fund has a 4-star rating from Value Research. Almost 98.9% of the portfolio is invested and the remaining is held in cash. The fund has significant exposure to largecap stocks and as much as 7 of the top holdings are from the largecap space. The net asset value under the growth plan is Rs 46.62.
The minimum investment that is required to start an SIP is Rs 500.
Disclaimer
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The gains from growth mutual funds are re-invested back into the scheme. The NAV reflects your gains in the growth mutual fund (Net Asset Value). If the scheme is profitable, the scheme’s NAV rises. Similarly, in the event of a failure, the NAV drops. As an investor in a growth mutual fund, you can only benefit when you redeem or sell your shares. As a result, you will still have the same number of units as you did when you first joined the system. The scheme’s NAV fluctuates based on the fund’s results.
Assume you purchase 100 units of a Rs 50 NAV equity fund. The scheme’s NAV rises to Rs 60 in a year if you choose the growth option. You make a profit of Rs 6,000 by selling the units. As a result, your investment yielded a profit of Rs 1,000. (Rs 6,000-Rs 5,000).
What is Dividend Mutual Funds Option?
The dividend alternative provides you with a steady stream of income. The fund distributes dividends based on the distributable surplus that the plan has amassed. If you own 1,000 shares of a mutual fund and the fund announces a dividend of Rs. 2 per share, you will receive Rs. 2,000 as a “dividend in an equity-based scheme.” In other schemes, however, the scheme would be required to pay a Dividend Distribution Tax (DDT), which would reduce the dividend you earn by that amount.
Profits earned by the scheme are not re-invested in the scheme in this option. Instead, profits will be allocated to investors in the form of dividends, which will be paid out monthly, quarterly, half-yearly, or annually.
However, these dividends are only paid out when the scheme makes a profit, and they are subject to the fund manager’s discretion.
What is the difference between Growth and Dividend Plans?
The way earnings are allocated to investors is the primary difference between growth and dividend. The returns on both plans are almost identical. Since the growth plan’s gains are reinvested, the returns are multiplied. Your gains are used to purchase further fund units of the dividend form, increasing the number of shares held by the investor.
Key difference between Growth and Dividend Plans
Differences
Dividend MF Option
Growth MF Option
Profits
Distributed to investors
Re-invested in the scheme
Tax on MF
As per tax slabs
Depends on when you sell or redeem
NAV
NAV is reduced as per dividends paid. So NAV will be reduced
NAV will be higher because profits re-invested may earn profits
Returns
Due to periodic payouts, total returns would be lower in the long run compared to the growth alternative.
For long investment, total returns would normally be higher than dividend returns.
Taxation on Growth and Dividend Mutual Funds
When deciding whether to invest in a growth or dividend fund, this is an important factor to remember. If you keep the growth scheme for more than a year, it is considered tax-free. If you hold it for less than a year, you will be subject to a 15% short-term capital gains levy. Dividend payouts to investors are tax-free in the dividend fund alternative. However, the fund levies a Dividend Distribution Tax of 10%. (DDT). In terms of tax incentives, the development strategy is more competitive than dividends.
Dividends from equity mutual funds are subject to a 10% dividend distribution levy. This is a little less than the 15% short-term gains tax that growth mutual funds are subject to holding periods less than 1 year. It is, however, the same as the 10% long-term capital gains tax that growth mutual funds pay.
Dividends from debt mutual funds are subject to a 25 percent dividend distribution levy, plus a surcharge and cess, bringing the overall DDT to nearly 29 percent. This is very similar to the highest income tax slab rate in India, which is 30%.
Conclusion
Whether you want the dividend or growth choice is entirely up to you. When stocks are at all-time highs, the dividend option works better. However, since dividends are not re-invested in the scheme, you can miss out on the compounding of returns. For investors with a long-term investment horizon, the growth choice may be appropriate. It will assist them in building a retirement fund. Furthermore, if you have a steady income and don’t need dividends, choose the growth option.
Broking Firm Emkay Global is bullish on the stock of Crompton Greaves CE and has recommended buying the stock with a price target of Rs 480 on the stock, against a current market price of Rs 402. This means the target price of the stock, implies gains of nearly 20 per cent.
“Crompton Greaves Consumer Electricals delivered strong performance in Q4, with EBITDA beating our expectations by 6%. ECD segment revenues saw a healthy 2-year Compounded Annual Growth Rate of 17%, driven by growth across product categories and channels, market share gains in fans and rural expansion.
After many challenging quarters, the lighting segment registered 15% yoy growth in revenue, supported by 23% volume growth in the B2C business. Despite weak B2G business, EBIT margins expanded by 841 basis points, year- on year to 16.1%, driven by cost optimization,” the broking firm has said.
According to Emkay Global Financials, currently, channel inventory for Fans is higher than last year. A gradual recovery in revenue is expected from Q2, similar to that of last year. Margins should remain impacted for 1-2 quarters due to commodity headwinds and the lag in implementing price increases.
“We reduce FY22-23E EPS by 2-4% as we factor in lower revenues and higher costs due to prevailing commodity inflation. Superior performance vs. peers and favorable valuations keep us constructive. Retain Buy with a revised target price of Rs 480 (43x FY23E EPS) vs. Rs 490,” the broking firm has said.
According to Emkay Global, the management has reiterated its strategy to focus on new product launches, distribution reach expansion across the categories, full-fledged product portfolio ramp-up in appliances, and cost optimization to mitigate commodity price impact. The Lighting segment has seen a structural change with stabilization in pricing, auguring well for sustained double-digit margins going forward.
“Commodity inflation should be offset through price increases, premiumization and cost savings. The company is targeting to achieve cost savings of Rs1.8 bn in FY22 under project ‘Unnati.’ Majority of these savings will be reinvested for future growth through enhanced Research & Development investments, brand strengthening, distribution expansion and accelerated pace of new product launches, in our view,” the firm has said.
The key risks according to Emkay Global would be delayed demand recovery, market share losses, slow execution of new product launches, supply-chain disruptions, and sustained commodity price inflation.
A service fee is an amount charged to individuals for accessing different tasks, such as withdrawing cash at an ATM of another bank. A monthly maintenance fee is charged by the bank when you open a savings account with them. At the end of each month, this amount is deducted from the account. Similarly, service charges are often charged while accessing a different bank’s ATM or initiating a fund transfer. Now let’s take a glance at the charges that top banks charge for different services.
Charges for cash transactions
In most banks, a savings account holder is limited to conduct some free transactions, exceeding which a fee is imposed by the banks. If a customer exceeds the cap of four free transactions or cash withdrawals of up to Rs 2 lakh in a month, Axis Bank imposes charges on him or her. After May 1, Axis Bank customers who withdraw money from their savings account over the free cap must pay 2.5 per cent of the amount withdrawn. Saving bank customers in metro cities will be charged Rs 125 per transaction, whereas senior citizens, pensioners, and saving bank account customers in rural/semi-urban areas will be charged Rs 100 per transaction by Bank of Baroda after the limit of three transactions per month is surpassed. Account-holders of the Pradhan Mantri Jan Dhan Yojana (PMJDY) are excluded from these fees. Service charges for Basic Savings Bank Deposit (BSBD) account holders have been revised by the country’s largest lender, State Bank of India (SBI). SBI stated on its website that the new fees would refer to ATM withdrawals, chequebook, transfer, and other non-financial transactions. The revised service charges will be enforced on July 1, 2021. The revised fee per cash withdrawal transaction at a Branch Channel/ATM is Rs 15 plus GST. Charges will be recovered after the first four free cash withdrawal transactions, according to the SBI website (including at ATM and branch). At all SBI and non-SBI ATMs, the service fee above the ceiling would be Rs 15 plus GST.
Cash withdrawal charges at ATM
Regular savings bank account holders at the State Bank of India (SBI) and ICICI Bank are allowed for eight free transactions in metro cities, including five from home-branch ATMs and three from non-home branch ATMs. Banks charge from Rs 20 to Rs 50 per withdrawal after the specified cap has been reached. At HDFC Bank, however, there is no service fee for cash withdrawals at home branches. However, non-home branches allow free cash withdrawals up to Rs.1,00,000/- per day, after which charges apply at Rs.2/1000, with a minimum of Rs.50/- per transaction; third-party cash withdrawals are limited to Rs.50,000/- per transaction. Cash withdrawals above the free cap are currently charged at Rs 5 per Rs 1,000 or Rs 150, whichever is higher. Cash withdrawals above the free limit will be charged by Axis Bank at a rate of Rs 10 per Rs 1,000 or Rs 150, whichever is higher, starting from May 1, 2021.
Charges for failed ATM transaction
Despite the fact that the Reserve Bank of India (RBI) has announced that banks cannot charge customers for failed transactions, banks charge a fee for a failed ATM transaction due to insufficient balance in the customer’s account. For each unsuccessful transaction, SBI charges a fee of Rs 20 plus GST. For each failed transaction, HDFC Bank, ICICI Bank, Kotak Mahindra, and Yes Bank charges a fee of Rs 25.
Minimum balance
If a customer’s account balance slips below the specified amount, the bank imposes a fee. Customers in ICICI Bank’s metro and urban branches must maintain a minimum balance of Rs 10,000, whereas customers in semi-urban and rural branches must maintain a minimum balance of Rs 5,000. In Metro/Urban/Semi-Urban/Rural areas, if a customer fails to maintain the necessary minimum balance, the bank will charge a fee of Rs100 + 5% of the deficit in the specified minimum balance. The average monthly balance (AMB) requirement for HDFC Bank’s urban branch accounts is Rs 10,000, while the criteria for semi-urban branch accounts is Rs 5,000. The charges are Rs 600 a month if the AMB is less than Rs 2,500 in an urban branch account, and Rs 150 if the AMB is less than Rs 10,000 but more than Rs 7,500. On the other hand, a Monthly Service Fee (MSF) of Rs.10 per Rs.100 deficit in required balance or Rs.600, whichever is lower, with a minimum charge of Rs.150 is charged by Axis Bank.
SMS Charges
Customers are alerted by their banks of transactions that occur from their accounts. According to the Axis Bank website, the fee for certain value-added services (VAS) notifications is currently charged at Rs 5 per month (imposed quarterly at Rs 15 per quarter) on a subscription basis (s). This will be in effect until June 30, 2021. Starting July 1, 2021, a 25-paise-per-SMS SMS alert fee will be charged depending on actual usage/SMS sent to the individual, with a monthly limit of Rs 25. Charges are not applied on promotional SMS sent by the bank or OTP alerts. SBI had waived SMS service charges in August of last year. Customers who register for InstaAlert service with ‘SMS’ as the delivery platform will be charged Rs. 15 per quarter in the case of salary or savings accounts, and Rs. 25 per quarter in the case of current accounts at HDFC Bank. As of now, all ICICI Bank Savings Account customers will be charged Rs. 15 per quarter to use the Alerts facility via SMS.
Debit card charges in case of replacement
If you misplace the debit card, your bank will charge you a fee of Rs 50-500 to replace it. SBI, for example, currently charges Rs 300+GST for Debit Card Replacement. HDFC Bank and Axis Bank, on the other hand, charge a fee of Rs 200 for the same.
Documentation charges
Customers are charged by banks for the issuance of documents also. For duplicate physical passbooks and account statements, banks charge Rs 50-150. For example, SBI charges a fee of Rs 150 for signature verification. Banks issue one annual account statement per financial year to their customers. Customers who request a duplicate account statement, on the other hand, maybe charged between Rs 50 and Rs 100. Each duplicate statement costs Rs 100 at ICICI Bank. In particular, HDFC Bank and Axis Bank also charge Rs. 100 per statement.
Cheque clearance charges
For cheques worth more than Rs 1 lakh, the RBI has set a maximum fee of Rs 150 per cheque. Cheques with an amount of up to Rs 1 lakh are free of charge. For savings bank account holders, SBI will only provide 10 free cheque leaves every financial year. Additional 10-leaf cheque books will be issued at Rs 40 plus GST after that. The bank will charge you Rs 75 plus GST for 25 leaf cheque books. No such charges have been levied on senior citizens. Whereas for outstation cheque collection -through non-ICICI bank branch locations, ICICI Bank charges Rs. 200 per instrument for an amount of above Rs. 1 lakh.
IMPS Fund transfer charges
Although all Indian banks have made NEFT and RTGS transactions free for their customers, IMPS (Immediate Payment Service) transactions are still not free from charges which vary according to the amount and can range between Rs 1 to Rs 25. Currently, SBI has waived the charge for all IMPS transactions. Whereas, at HDFC Bank, transactions above Rs 1 lakh would incur a fee of Rs 15 plus GST. Axis Bank and ICICI Bank charge the same fee, but only for an amount ranging from Rs 1 lakh to Rs 2 lakh.
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The below are the criteria for enrolling in the Pradhan Mantri Suraksha Bima Yojana:
The PMSBY scheme is open to all individual bank account holders between the ages of 18 and 70, regardless of whether they have a single or joint account.
If an individual has multiple accounts with different banks, he would only be able to enter the scheme with one of them.
In the case of joint accounts, both account holders would be eligible to participate in the scheme.
Premium amount
The annual insurance premium for each member of the PMSBY scheme is Rs.12. Every June, the policyholder’s premium will be deducted via auto-debit from his or her bank savings account. Aadhaar card must be provided as a KYC document to be enrolled under the scheme. If the policyholder hits the age of 70, the bank savings account does not have the required minimum balance to cover the premium through auto-debit, or the policyholder has more than one policy under the same scheme, the PMSBY policy would be revoked. To maintain their insurance coverage active, holders must pay the premium in May. When you enter the scheme, you must allow the auto-debit option in your bank account for the annual premium to be deducted.
Coverage
PMSBY has a death compensation of up to Rs.2 lakhs. The insurance cover is up to Rs.2 lakh in the event of complete disability, such as the loss of all hands or eyes. The sum assured in the event of partial disability, such as the loss of one limb or eyes, is Rs.1 lakh. If the subscriber dies in an accident or becomes completely disabled as a result of the accident, the nominee of the subscriber is entitled to up to Rs.2 lakh in coverage. The subscriber can also claim a deduction for the premium paid under Section 80C. Section 10(10D) of the Income Tax Act exempts the amount insured received up to Rs.1 lakh from taxation.
How to enroll for the scheme?
To participate in the PMSBY scheme, one must fill out an application and send it to the concerned bank. Individuals can also apply online by signing in to their bank’s net banking account. Applicant’s Aadhaar Card, Identity Card, Bank Account Passbook, Age Certificate, Income Certificate, Mobile Number, and Passport Size Photograph are required to open an account under the Pradhan Mantri Suraksha Bima Yojana. Public Sector General Insurance Companies (PSGICs) and other general insurance firms, in partnership with active banks, provide and manage the scheme. Subscribers can also send a message to the toll-free numbers of banks and insurance providers using their registered mobile number. Individuals can enrol by contacting an associated bank or insurance provider, or by downloading the form from https://www.jansuraksha.gov.in/Forms-PMSBY.aspx. The enrollment period is one year, beginning on June 1st and ending on May 31st of the subsequent year. Every year, by May 31, the bank will provide the auto-debit instruction. Since it is a yearly scheme, the person must agree to auto-debit by May 31 of the ensuing years.
How to raise a claim?
The insured or nominee (in the case of death) must notify the bank as soon as possible after the accident occurs of the account holder. The claim form can be downloaded from the website of banks or designated insurance agencies and must be filled out correctly with the required details. Within 30 days of the date of the accident, the completed claim form must be submitted to the bank branch along with the required documents. The claim can be lodged by the nominee mentioned on the enrollment form, or by the legitimate heirs if there is no nominee. The individual’s disability claim will be credited to his or her bank account. It will be credited to the nominee’s/legal heir’s bank account in the event of death. The claim form is available for download at https://www.jansuraksha.gov.in/Forms-PMSBY.aspx.
The claim will be issued within 30 days of the bank receiving the application form along with the required documents.
When the premium is debited from the account?
All Pradhan Mantri Suraksha Bima Yojana’s applicants will be required to pay an annual premium of Rs 12 that will be deducted automatically from their bank accounts. The deduction of the premium amount will be notified to the beneficiaries via SMS. Those that have registered in the insurance scheme have a Rs 12 annual premium deducted automatically from their accounts. Beneficiaries are notified of this via SMS, which is usually performed between May 25 and May 31 every year.
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