NSDL Update - News - August 2015
Reserve Bank of India (RBI) has granted in-principle nod to NSDL & 10 other entities which include Aditya Birla Nuvo Ltd., Airtel M Commerce Services Ltd., Cholamandalam Distribution Services Ltd., Department of Posts, Fino PayTech Ltd., Reliance Industries Ltd., Dilip Shantilal Shanghvi, Vijay Shekhar Sharma, Tech Mahindra Ltd. & Vodafone m-pesa Ltd. to start Payment Banks.
A Payment Bank differs from conventional banks as it cannot lend to its customers. It is allowed to take deposits, allow remittances and provide simple financial products. Payment Banks are expected to reach customers mainly through their mobile phones rather than traditional bank branches.
✔ Payment Banks can’t offer loans but can raise deposits of upto `1 lakh, and pay interest on these balances just like a savings bank account does.
✔ They can enable transfers and remittances through a mobile phone.
✔ They can offer services such as automatic payments of bills, and purchases in cashless, chequeless transactions through a phone.
✔ They can issue debit cards and ATM cards usable on ATM networks of all banks.
✔ They can transfer money directly to bank accounts at nearly no cost being a part of the gateway that connects banks.
✔ They can provide forex cards to travellers, usable again as a debit or ATM card all over India.
✔ They can offer forex services at charges lower than banks.
✔ They can also offer card acceptance mechanisms to third parties such as the‘Apple Pay.’
✔ They can’t issue credit cards
This is for the first time in the history of India's banking sector that RBI is giving out differentiated licenses for specific activities for pushing financial inclusion in the country. It’s a step to redefine banking in India. RBI expects payment banks to target India’s migrant labourers, low-income households and small businesses, offering savings accounts and remittance services with a low transaction cost. Payments Banks will enable poorer citizens who transact only in cash to take their first step into formal banking. It could be uneconomical for traditional banks to open branches in every village but the mobile phones coverage is a promising low-cost platform for quickly taking basic banking services to every rural citizen. The innovation is also expected to accelerate India’s journey into a cashless economy.
India’s domestic remittance market is estimated to be about `800-900 billion and growing. With money transfers made possible through mobile phones, a big chunk of it, especially that of the migrant labour, could shift to this new platform. Payment banks can also play a crucial role in implementing the government’s direct benefit transfer scheme, where subsidies on healthcare, education and gas are paid directly to beneficiaries’ accounts.
During August 2015, five more Participants have subscribed to the SPEED-e facility viz.,
➢ Nikunj Stock Brokers Ltd. (DP ID IN302994)
➢ Indiabulls Ventures Limited (DP ID IN302236)
➢ Consortium Securities Private Limited (DP ID IN302316)
➢ SBICAP Securities Limited (DP ID IN306114)
➢ Integrated Master Securities Private Limited (DP ID IN300724)
Clients of the above mentioned Participants can now avail the facility of submitting various instructions through SPEED-e facility.
This takes the total number of Participants who have subscribed to SPEED-e to 175.
In order to reach out to investors that are spread across the country and to apprise them about the facilities available in NSDL depository system and the awareness on stock markets, NSDL conducted 19 Joint Awareness Programmes in association with Axis Securities Limited, BMA Wealth Creators Limited, ICICI Securities Limited, Peerless Securities Limited, Ventura Securities Limited, Jhaveri Securities Limited & Shah Investor’s Home Limited at various locations during July 2015 which were attended by more than 1,100 investors.
Women play an important role in day to day finances of the households. Therefore, to reach out to women to impart basic knowledge about investing and about demat & to further equip them to take more knowledgeable investment decisions, NSDL in joint association with Lokmat conducted three Women Empowerment programmes for around 265 women in July 2015 covering topics such as SIP, Mutual Funds, Demat and other NSDL products.
To spread awareness about Depository related services & the new features introduced in NSDL Depository system, NSDL conducted a training programme for branch officials of ‘Muthoot Securities Limited’ during July 2015. This programme was attended by around 45 branch officials of Muthoot Securities Limited.
➢ Events conducted in association with Institutions:
In July 2015, NSDL organised an event titled “Putting Investor First” in association with CFA Institute in Mumbai to build awareness of the duty to protect investor interests at all times, and to ensure that all investment professionals understand their primary role is to serve and protect investors. This event was attended by more than 250 delegates. Further, NSDL also sponsored an event titled “Finance Fair 2015” in association with National Stock Exchange (NSE). This event was attended by more than 1,000 investors. Various aspects on Depository related services were explained to these investors attending this event.
➢ NSDL Brand Ambassador:
NSDL has been carrying out various Investor Education initiatives like Investor Depository Meets (IDMs), Corporate Awareness Programmes (CAPs), promotion through media etc. in order to educate the Investors. Apart from these initiatives, in order to reach out to students, NSDL has been conducting educational programmes like workshops for students from various colleges across India, sponsorships and setting up of stalls during college festivals. NSDL launched an initiative called “NSDL Brand Ambassador (NSDL BA)” last year for student community education and to popularize demat products and related concepts amongst eight different colleges in Mumbai which was appreciated by various Institutes.
In order to keep the same temperament amongst different colleges, NSDL conducted an NSDL Brand Ambassador (NSDL BA) contest at SIES College of Commerce & Economics, Mumbai during July 2015. More than 80 students participated in this Brand Ambassadorship programme. Mr. Tejas Sridhar & Ms. ShreeLaxmi Haridas Menon from SIES College of Commerce & Economics were selected as the Brand Ambassadors of NSDL for year 2015. NSDL BA’s will be acting as face of NSDL in their colleges and will help NSDL to spread awareness about the depository and its related features to other students of colleges.