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The <keyword id="6354335" type="CITY" weightage="20" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> (<keyword id="30067" type="ORGANIZATION" weightage="20" keywordseo="RBI">RBI</keyword>) cut repo rate by 25 bps to 6.25% and now banks have to be active in passing it to the consumers so that people, especially the home-buyers, benefit from the interest rate cut. 
 The repo rate cut by <keyword id="3715773" type="UNKNOWN" weightage="20" keywordseo="rbi-governor-urjit-patel">RBI Governor Urjit Patel</keyword> has indeed come as a good news for home-buyers as <keyword id="6388045" type="COMPANY" weightage="20" keywordseo="emis">EMIs</keyword> are now expected to go down. 
 
Now, it all depends on the banks as since 2015, despite the RBI slashing the repo rate by 1.50%, the banks have passed on a mere 0.5%. 
 
However, one of the main losers due to the repo rate cut will be people having Fixed Deposits (FDs). This is because, with a lower repo rate, banks will also cut the deposit rate if liquidity is comfortable. This will impact depositors and investors and is expected that the interest on FDs will fall in the immediate future. 
 
If you are still confused on all the repo rates and Cash Reserve Ratio (CRR), here’s the simplified version: 
 
Repo rate: 
Repo rate is the rate at which the RBI lends money to the banks when there is fund crunch and is cut or increased, keeping the inflation in mind. So, if inflation is high and banks increase the repo rate, banks will have to take money from the RBI at a higher rate. 
 
Reverse repo rate: 
Reverse repo rate is the rate at which the RBI borrows money from the banks. If the Reverse repo rate goes up, banks will get more money to park their funds with the central bank. 
 
Cash Reserve Ratio (CRR): 
CRR is the minimum amount that banks have to keep from the total deposits of customers. This goes in the current account of the banks and they do not earn any interest on this. Presently, the CRR is at 4%. 
 
So, how does this affect you? 
 
Home-loans and Auto loans: If banks pass on the rates, consumers will benefit from the cumulative effect. EMIs will fall as banks will also lower down their lending rate as it all depends on banks’ marginal cost of funds based on lending rates. 
 
FD investors: This is impact the fixed deposits as the banks will have to cut rates on the FDs and people will earn less interest.

Decoded: Here’s how repo rate cut will help home-buyers and affect FD investors

<a href="http://www.businessinsider.in/DoYou-Need-Aadhaar-Card-Govt-Says-Yes-Supreme-Court-Says-No/articleshow/22981267.cms">Controversy</a> is still raging over the mandatory use of <keyword id="144117" type="ORGANIZATION" weightage="100" keywordseo="AADHAAR">Aadhaar</keyword>, but an expert <keyword id="2006823" type="UNKNOWN" weightage="100" keywordseo="Committee-on-financial-inclusion">committee on financial inclusion</keyword> has already recommended that the <keyword id="6354335" type="CITY" weightage="100" keywordseo="reserve-bank-of-india">Reserve Bank of India</keyword> should leverage the <keyword id="2006820" type="UNKNOWN" weightage="100" keywordseo="Aadhaar-network">Aadhaar network</keyword> to ensure that every Indian has a <keyword id="2006817" type="UNKNOWN" weightage="100" keywordseo="Free-bank-account">free bank account</keyword> by January 2016. The recommendation has come from the Committee on Comprehensive <keyword id="2006821" type="UNKNOWN" weightage="100" keywordseo="Financial-Services-for-Small-Business">Financial Services for Small Business</keyword> and Low-Income Households, which is headed by <keyword id="311391" type="PERSON" weightage="100" keywordseo="Nachiket-Mor">Nachiket Mor</keyword>, an <keyword id="2006825" type="UNKNOWN" weightage="100" keywordseo="RBI-board-member">RBI board member</keyword> and former <keyword id="6653" type="CITY" weightage="100" keywordseo="ICICI-bank">ICICI Bank</keyword> executive. 
 <keyword id="30067" type="ORGANIZATION" weightage="100" keywordseo="RBI">RBI</keyword> set up the committee last September and it has now sought comments from the public on the <keyword id="1180163" type="UNKNOWN" weightage="100" keywordseo="draft-recommendations">draft recommendations</keyword> on or before January 24, 2014. Other key members of the panel include former <keyword id="44473" type="CITY" weightage="80" keywordseo="Citigroup">Citigroup</keyword> CEO <keyword id="25396" type="PERSON" weightage="100" keywordseo="Vikram-Pandit">Vikram Pandit</keyword> and <keyword id="2006826" type="UNKNOWN" weightage="100" keywordseo="Axis-Bank-CMD">Axis Bank CMD</keyword> <keyword id="6356453" type="PERSON" weightage="100" keywordseo="Shikha-Sharma">Shikha Sharma</keyword>. 
 According to the report, every Indian resident over 18 years of age should be automatically issued a “universal <keyword id="2006829" type="UNKNOWN" weightage="100" keywordseo="Electronic-bank-account">electronic bank account</keyword> at the time of receiving his/her <keyword id="485058" type="UNKNOWN" weightage="100" keywordseo="Aadhaar-number">Aadhaar number</keyword>.” One can choose his/her <keyword id="2006832" type="COMPANY" weightage="100" keywordseo="Preferred-bank">preferred bank</keyword> from the empanelled ones and need not pay any fee for opening an account. However, the bank can levy <keyword id="162862" type="UNKNOWN" weightage="100" keywordseo="transaction-charges">transaction charges</keyword>, the committee says. It also recommends setting up of a ‘unified’ redressal agency under the <keyword id="47209" type="ORGANIZATION" weightage="100" keywordseo="Finance-Ministry">finance ministry</keyword> to deal with <keyword id="786199" type="UNKNOWN" weightage="100" keywordseo="customer-complaints">customer complaints</keyword>. 
 About 90% of small businesses have no links to a <keyword id="154831" type="ORGANIZATION" weightage="100" keywordseo="financial-institution">financial institution</keyword> and 60% of Indians do not have bank accounts, the report states. “Aadhaar is the key piece of infrastructure to enable a customer to be identified and authenticated so that repudiation and fraud risks are minimised and therefore, should become the universal basis for authentication,” it adds. 
 The panel has also suggested that a special type of <keyword id="6368751" type="PERSON" weightage="100" keywordseo="Banks">banks</keyword> should be introduced to provide payment services and deposit products to small businesses and low-income households. Such banks could be categorised as <keyword id="2006841" type="UNKNOWN" weightage="100" keywordseo="Payments-banks">payments banks</keyword> and “they will be restricted to holding a <keyword id="2006842" type="UNKNOWN" weightage="100" keywordseo="Maximum-balance">maximum balance</keyword> of Rs 50,000 per customer,” the report says. Even <keyword id="2006844" type="UNKNOWN" weightage="100" keywordseo="Existing-lenders">existing lenders</keyword> can set up these payments banks as <keyword id="4128451" type="UNKNOWN" weightage="100" keywordseo="subsidiaries">subsidiaries</keyword>. The report also recommends setting up another category of wholesale banks that will provide funds to other banks and financial institutions that directly lend to low-income households. 
 On the face of it, the recommendations to introduce a multi-layered <keyword id="6354778" type="ORGANIZATION" weightage="100" keywordseo="Banking">banking</keyword> system make sound sense as these ‘proposed’ entities will be serving the <keyword id="2006855" type="UNKNOWN" weightage="100" keywordseo="Financially-weak">financially weak</keyword> segment of the country and overall, the inclusion plan for 2013-2016 looks good. 
 
Except for the Aadhaar part. 
 But before we go ahead, let us have a look at Aadhaar and what all it offers. Launched by the <keyword id="86474" type="ORGANIZATION" weightage="100" keywordseo="Unique-Identification-Authority-of-India">Unique Identification Authority of India</keyword> (<keyword id="6355252" type="CITY" weightage="100" keywordseo="UIDAI">UIDAI</keyword>), the <keyword id="804646" type="UNKNOWN" weightage="100" keywordseo="Aadhaar-scheme">Aadhaar scheme</keyword> was initially introduced to ‘promote inclusion and benefits of the <keyword id="1389586" type="UNKNOWN" weightage="100" keywordseo="marginalised-sections">marginalised sections</keyword> of the society that has no <keyword id="2006861" type="UNKNOWN" weightage="100" keywordseo="Formal-identity-proof">formal identity proof</keyword>.’ Even today, Aadhaar-enabled services are essentially linked to various <keyword id="580043" type="UNKNOWN" weightage="100" keywordseo="government-welfare-schemes">government welfare schemes</keyword> – so that its beneficiaries can access the same in a hassle-free manner. 
 However, the ‘<keyword id="2006816" type="UNKNOWN" weightage="100" keywordseo="Banking-for-all">banking for all</keyword>’ initiative in its ‘suggested’ format cannot be a marginalised movement, aimed to serve only the under-banked/unbanked regions or the weaker section or those below the <keyword id="141042" type="ORGANIZATION" weightage="100" keywordseo="poverty-line">poverty line</keyword>. It has to have a <keyword id="2006866" type="UNKNOWN" weightage="100" keywordseo="Unified-structure">unified structure</keyword> across the country – involving every Indian citizen. In other words, it will be much like the ‘<keyword id="49358" type="UNKNOWN" weightage="100" keywordseo="voter-card">voter card</keyword>’ mechanism we have in place right now. At the age of 18, an Indian is entitled to get a voter card irrespective of the <keyword id="2006868" type="UNKNOWN" weightage="100" keywordseo="Financial-divides">financial divides</keyword>. Going forward, if the central bank intends to follow the same principle and wants to bring the entire population of the country under its <keyword id="2006870" type="UNKNOWN" weightage="100" keywordseo="Inclusion-umbrella">inclusion umbrella</keyword> (after all, one cannot leave one section of the citizens out of a <keyword id="2006871" type="UNKNOWN" weightage="100" keywordseo="Mass-initiative">mass initiative</keyword> just because they are financially more stable), opening an account at the stipulated age should become mandatory and that means a mandatory <keyword id="1953676" type="UNKNOWN" weightage="100" keywordseo="Aadhaar-validation">Aadhaar validation</keyword>. 
 And that brings us back to the basic question – what is the legal status of Aadhaar in India? Is it just a <keyword id="107911" type="ORGANIZATION" weightage="100" keywordseo="Financial-inclusion">financial inclusion</keyword> tool for the economically weak or do the government agencies intend to turn it into an ‘all-inclusive’ tool required for every social and <keyword id="672932" type="ORGANIZATION" weightage="100" keywordseo="economic-activity">economic activity</keyword> – right from <keyword id="427269" type="UNKNOWN" weightage="100" keywordseo="Marriage-registration">marriage registration</keyword> to <keyword id="854003" type="UNKNOWN" weightage="100" keywordseo="land-registration">land registration</keyword>, from banking to <keyword id="6368952" type="ORGANIZATION" weightage="100" keywordseo="shopping">shopping</keyword> and more? 
 The RBI has already asked banks to ensure <keyword id="1953683" type="UNKNOWN" weightage="100" keywordseo="Aadhaar-authentication">Aadhaar authentication</keyword> for <a href="http://www.businessinsider.in/Now-RBI-Wants-Aadhaar-Validation-For-Card-based-Transactions/articleshow/26473660.cms">card transactions</a> at merchant locations. “All new card present infrastructure has to be enabled for both <keyword id="1953693" type="UNKNOWN" weightage="100" keywordseo="EMV-chip-and-PIN">EMV chip and PIN</keyword> and Aadhaar (<keyword id="1953679" type="UNKNOWN" weightage="100" keywordseo="Biometric-validation">biometric validation</keyword>) acceptance,” the central bank stated in a notification on November 26 last year. 
 Although the <keyword id="6354977" type="ORGANIZATION" weightage="80" keywordseo="Supreme-Court">Supreme Court</keyword> has ruled that the <keyword id="6356006" type="UNKNOWN" weightage="100" keywordseo="Aadhaar-card">Aadhaar Card</keyword> is not mandatory to get <keyword id="1739662" type="UNKNOWN" weightage="100" keywordseo="government-benefits">government benefits</keyword> and services, and the <keyword id="1878758" type="UNKNOWN" weightage="100" keywordseo="National-Identity-Authority-of-India-Bill">National Identity Authority of India Bill</keyword> is yet to get Parliamentary nod, Aadhaar seems to be enjoying a more hallowed status and getting its teeth deep into every key financial transaction one can think of. That might not be quite desirable at this stage as divulging <keyword id="441301" type="UNKNOWN" weightage="100" keywordseo="biometric-data">biometric data</keyword> (required for Aadhaar Card) is still considered voluntary and <keyword id="2006881" type="UNKNOWN" weightage="100" keywordseo="Secure-storage">secure storage</keyword> of the same cannot be guaranteed even now. 
 The rest of the recommendations by the committee dwell on the structure and requirements of the <keyword id="2006882" type="UNKNOWN" weightage="100" keywordseo="Proposed-banks">proposed banks</keyword>, <keyword id="6597293" type="UNKNOWN" weightage="100" keywordseo="priority-sector-lending">priority sector lending</keyword> and deposits, and classification of non-banking financial companies (NBFCs). 
 Interestingly, the payment banks will be required to meet the standard <keyword id="35038" type="ORGANIZATION" weightage="80" keywordseo="crr">CRR</keyword> terms and must also deposit the balance proceeds in approved <keyword id="838337" type="UNKNOWN" weightage="100" keywordseo="SLR-securities">SLR securities</keyword> with duration of no more than three months. As they won’t be permitted to assume any kind of <keyword id="854662" type="UNKNOWN" weightage="100" keywordseo="Credit-risk">credit risk</keyword>, which literally rules out any risk of default, the <keyword id="2006891" type="UNKNOWN" weightage="100" keywordseo="Minimum-entry-capital">minimum entry capital</keyword> for them will be Rs 50 crore instead of the Rs 500 crore required for full-service commercial banks in the country. Also, the wholesale banks cannot accept deposits bigger than Rs 5 crore from a single depositor. 
 The RBI had launched a three-year financial <keyword id="2006853" type="UNKNOWN" weightage="100" keywordseo="Inclusion-programme">inclusion programme</keyword> in April 2010, which prompted banks to open outlets in 200,000 villages. The current recommendations seek to deepen such access and experts even feel that the new banking licences, to be announced soon, can be categorised accordingly. But both the government and the RBI should ensure that the programme becomes ‘inclusive’ in the true sense of the term and validation issues should not throw a spanner in the works.

Aadhaar Gaining More
Teeth, To Play Key Role In ‘Banking For All’

Economists are of the view that the measures taken by the <keyword id="6354335" type="General" weightage="50" keywordseo="reserve-bank-of-india" source="Orion">Reserve Bank of India</keyword> (<keyword id="30067" type="General" weightage="100" keywordseo="rbi" source="Orion">RBI</keyword>) have controlled inflation and add that inflation will come down. A senior economist also said the headline inflation could be 7.5 per cent in December putting a spanner in the inflation projections of the central bank. The RBI's Monetary Policy Committee (MPC) will meet on November 3 to discuss what it would tell the Centre as to why it was not able to restrain the inflation within four per cent + or - two per cent for three consecutive quarters. The RBI may also sound out to the Central government as to the course of inflation as well as the reasons why it may be at elevated levels. India's central bank has been trying to contain inflation by increasing the repo rate -- the rate at which it lends to the banks. The central bank has increased the repo rate by 190 basis points in recent times and the last one was by 50 basis points. In India, the retail inflation rose to 7.41 per cent in September. "The measures taken by the government and RBI have been able to control inflation from the high of 7.8 per cent we had seen in April. The fall in global commodity prices has also been supported in containing inflation. Inflationary expectations have also come down," Rajani Sinha, Chief Economist, CARE Ratings Ltd told IANS. "However, the concern is the stickiness of core inflation above six per cent and the renewed surge in domestic food inflation in the last few months. The measures taken by RBI to control inflation will show further impact with a lag of a few quarters," she added. "There is a strong case for the RBI arguing that (a) inflation has primarily been caused by supply-side shocks with global commodity prices having an impact (b) rupee depreciation has added to imported inflation (c) the RBI on its part was proactive in raising rates even between two policies as it did in May when it saw things were going out of hand post-Ukraine war and (d) there have been some measures like increase in goods and services tax (GST) which has added to inflation that was happening in parallel," Madan Sabnavis, Chief Economist, Bank of Baroda, told IANS. "Therefore, there is an explanation as to why inflation was high. But the central bank has been acting to bring it down through its instruments, like repo and CRR (cash reserve ratio). It has succeeded in lowering surplus liquidity too which can be proved," Sabnavis added. "There was a huge sale of forex almost Rs 3 lakh crore to maintain the exchange rate. Inflation which was more than the target continuously for three quarters is estimated to come to around 6 per cent by three more quarters. Interest rates (repo rate) have increased by almost 1.9 per cent. As such the MPC may only be constrained to say that the present steps taken need some more time for having a positive impact to reduce inflation. This is subject to the time inconsistency impact," K. Ramasubramanian, retired General Manager, RBI, and a forex advisor told IANS. According to Sinha, the CPI inflation is estimated to inch below seven per cent in the next few months due to the base effect and below six per cent by the end of the fiscal year. Looking ahead, Sinha said the RBI could hike the repo rate further by 25-50 bps in the current fiscal year. "As we approach closer to the neutral policy rate, RBI will get more cautious in its rate decision," she added. Citing the unseasonal rain affecting the Kharif crops and the September food inflation at 8.4 per cent Dr Soumya Kanti <keyword id="4757" type="General" weightage="50" keywordseo="ghosh" source="Orion">Ghosh</keyword>, Group Chief Economic Adviser, <keyword id="6354731" type="General" weightage="50" keywordseo="state-bank-of-india" source="Orion">State Bank of India</keyword> said in 2019 when such rains happened, the average food prices more than doubled from 4.9 per cent to 10.9 per cent. Similarly, the headline inflation in December could be 7.5 per cent and could put a spanner to the inflation projections of RBI and market consensus, Ghosh said in a research report. "This could also mean that the terminal repo rate could still be difficult to comprehend at this time, though consensus puts it at 6.5 per cent," Ghosh said. According to Sinha, the <keyword id="6356435" type="General" weightage="50" keywordseo="us-federal-reserve" source="Orion">US Federal Reserve</keyword>'s policy decisions and the consequences on the currency market will also have a bearing on RBI's future policy decisions. Economists said the MPC will not be deciding on the policy rate at their November 3 meeting. "With global commodity prices falling and the likely support of base effect in containing India's CPI inflation in the next few months, RBI is unlikely to be in a tearing hurry," Sinha added. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/india/news/no-scientific-basis-to-two-finger-test-on-rape-survivors-causes-trauma-sc/articleshow/95198492.cms">No scientific basis to two-finger test on rape survivors, causes trauma: SC</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/iit-madras-generates-rs-1081-cr-from-funding-and-revenue/articleshow/95200293.cms">IIT Madras generates Rs 1,081 cr from funding and revenue</a>

RBI measures controlled inflation, but challenges remain say economists

<ul><li>RBI Governor <keyword id="6359111" type="PERSON" weightage="20" keywordseo="Shaktikanta-Das">Shaktikanta Das</keyword>’ announcements are being termed as a ‘bazooka’ after he cut base interest rates by 0.75%</li><li>“The CRR cut should release ₹4,000-4,500 crore for our bank,” said Raj Kiran Rai MD and CEO of Union Bank.</li><li>“Our default fears have been allayed,” said A K Das, MD of Bank Of India.</li><li>“We will transfer the entire 75 basis point rate cut directly to our borrowers,” said Mallikarjun Rao, CEO of Punjab National Bank. </li></ul>Indian banks can now lend more money at cheaper rates and will be able to stress less about recovery. RBI Governor Shaktikanta Das’ announcements are being termed as a ‘bazooka’ after he cut base interest rates by 0.75%. He also said that banks can now maintain ‘lesser amounts’ as reserves as it relaxed the cash reserve ratio (CRR) norms. “The CRR cut should release ₹4,000-4,500 crore for our bank. There is a lot of demand for loans and we had sufficient liquidity to provide them to mutual funds and the private sector. This announcement gives further relief and I can buy a lot of bonds now as the yields are now good,” said Raj Kiran Rai MD and CEO of Union Bank who said that every box in his wishlist has been ticked. Neither corporates nor individuals have to pay EMIs for the next three months. “Our default fears have been allayed,” said A K Das, MD of Bank Of India. A lot of businesses which were stressed before the Covid-19 led shutdown have been falling into the red zone, and has been stressing bankers. However, Das paused the clock on all these troubles so that bankers can go back to lending to those who need it the most. “We are stretching imagination too far. This is a momentary respite for corporate and bankers. We can re-look at it 3-6 months down the line,” said A K Das. Interest rate for loans will be cheaper Shaktikanta Das is pushing banks to lend more as most of them have been parking funds with the RBI. He cut the interest rate that RBI pays for these parked funds by 90 basis points to what is called a reverse repo. “This is a bazooka for the markets. While a 75 basis point rate cut has been announced, it effectively translates to a 100 basis point cut for the market with changes in reverse repo,” said Sajjid Chinnoy, chief economist at JP <keyword id="152186" type="PERSON" weightage="20" keywordseo="Morgan">Morgan</keyword>. A few elated bankers also said that they will pass on all the benefit of the rate cut just announced to their borrowers. It means that the actual cost of borrowing will go down for individuals and corporate alike. For the last one year, the RBI was pushing and warning bankers to pass on rate cut benefits to their clients with little success. But CRR cut and the fact that the regulator made it easy for banks to invest in bonds have given the much needed fillip. “We will transfer the 75 basis point rate cut directly to our borrowers. These measures will help greatly,” said Mallikarjun Rao, CEO of Punjab National Bank. SEE ALSO <a href="https://www.businessinsider.in/policy/economy/news/rbi-governor-shaktikanta-das-announces-steps-to-save-indian-economy-amidst-coronavirus-lockdown/articleshow/74840342.cms">WATCH RBI Governor Shaktikanta Das unveil $50 billion ammunition to keep the Indian economy breathing amidst coronavirus lockdown</a> <a href="https://www.businessinsider.in/india/news/lockdown-package-poor-indian-women-given-cash-grain-pulses-cooking-gas-to-feed-their-families/articleshow/74826863.cms">Lockdown package: Poor Indian women given cash, grain, pulses, cooking gas to feed their families</a>

Every box in our wishlist is ticked says bankers on RBI’s rate cut and other moves

The <keyword id="6354335" type="General" weightage="50" keywordseo="reserve-bank-of-india" source="Orion">Reserve Bank of India</keyword> (<keyword id="30067" type="General" weightage="100" keywordseo="rbi" source="Orion">RBI</keyword>) can argue its case strongly with the Central government as to why the <keyword id="22195" type="General" weightage="20" keywordseo="inflation" source="Orion">inflation</keyword> was not controlled at 4 per cent, said experts. The RBI's Monetary Policy Committee (MPC) will meet on November 3 to discuss what it would tell the Centre as to why it was not able to restrain the inflation. The RBI may also sound out the Central government as to the course of inflation as well as the reasons as to why it may be at the elevated levels. In <keyword id="3658" type="General" weightage="20" keywordseo="india" source="Orion">India</keyword>, the retail inflation rose to 7.41 per cent in September. Experts were of the view that a combination of global and local (glocal) factors -- geopolitical developments, crop production, reduction in crude oil production and the resulting price increase and depreciating rupee -- are expected to heat up the prices. The RBI on its part is trying to contain the inflation by increasing the repo rate -- the rate at which it lends to the banks. The central bank has increased the repo rate by 190 basis points in recent times and the last one was by 50 basis points last month. "There is a strong case for the RBI arguing that (a) inflation has primarily been caused by supply side shocks with global commodity prices having an impact (b) rupee depreciation has added to imported inflation (c) the RBI on its part was proactive in raising rates even between two policies as it did in May when it saw things were going out of hand post Ukraine war and (d) there have been some measures like increase in goods and services tax (GST) which has added to inflation that was happening in parallel," Madan Sabnavis, Chief Economist, Bank of Baroda, told IANS. "Therefore, there is an explanation as to why inflation was high. But the central bank has been acting to bring it down through the instruments it has like repo and CRR (cash reserve ratio). It has succeeded in lowering surplus liquidity too which can be proved," Sabnavis added. "The RBI can say that inflation is due to supply side constraints a nd excess liquidity," says K. Ramasubramanian, retired General Manager, RBI, and a forex advisor. "In addition, there was a huge sale of forex almost Rs 3 lakh crore to maintain the exchange rate. Inflation which was more than the target continuously for three quarters is estimated to come around 6 per cent by three more quarters. Interest rates (repo rate) have been increased almost 1.9 per cent. As such the MPC may only be constrained to say that the present steps taken need some more time for having a positive impact to reduce inflation. This is subject to the time inconsistency impact," he added. The RBI has scheduled the November 3 meeting of MPC under Section 45ZN of the RBI Act. As per the said Section, when the RBI fails to meet the inflation target, it shall send a report to the central government listing: (a) the reasons for failure to achieve the inflation target; (b) remedial actions proposed to be taken by it; and (c) an estimate of the time-period within which the inflation target shall be achieved pursuant to timely implementation of proposed remedial actions. As per the RBI Act the MPC shall determine the Policy Rate required to achieve the inflation target. Further as per the RBI Act, the central bank shall organise at least four meetings of the MPC in a year. Announcing the credit policy RBI Governor Shaktikanta Das said: "There are also upside risks to food prices. Cereal price pressure is spreading from wheat to rice due to the likely lower kharif paddy production. "The lower sowing for kharif pulses could also cause some pressures. The delayed withdrawal of monsoon and intense rain spells in various regions have already started to impact vegetable prices, especially tomatoes. These risks to food inflation could have an adverse impact on inflation expectations." According to the RBI Governor, the Indian basket crude oil price was around $104 per barrel in H1:2022-23 and expected to be around $100 per barrel in H2: 2022-23. "Taking into account these factors, the inflation projection is retained at 6.7 per cent in 2022-23, with Q2 at 7.1 per cent; Q3 at 6.5 per cent; and Q4 at 5.8 per cent, with risks evenly balanced. CPI (consumer price index) inflation is projected to further reduce to 5.0 per cent in Q1:2023-24," Das said. However, one has to see the RBI's prediction as to crude oil prices ($100 per barrel) as the oil producing countries have announced a cut in their production and the international prices going up. Economists and common man have a different take on the RBI's expectations on inflation. "Presently inflation does appear unlikely that it will move downwards for two sets of factors. The increase in oil price and rupee depreciation has potential to increase imported inflation," Sabnavis had told IANS earlier. "Second, there have been some shortfalls in kharif production which will mean an increase in prices. Also the late withdrawal of rain has affected vegetable crops and also adversely affected the harvest of rice and oilseeds in some regions." The reduction in sown area for rice and pulses during Kharif season is expected to feed inflation in the coming months. The overall sown acreage for the Kharif season has declined by 0.8 per cent at the end of September 30, 2022 as compared to last year, the Bank of Baroda said in a recent report. "The inflation rate will be 6.5-7 per cent in FY23 and 5.5-6 per cent in FY24," Sabnavis had remarked. The RBI Governor had said the communication with the central government is a privileged one and it will not made public by the Bank. Das also said there no legal stipulation on the frequency of the communication between RBI and the government. He had earlier said the inflation rate is expected to come down to four per cent in two years time. There are many uncertainties. The RBI has pegged the inflation rate at 6.7 per cent for FY23. SEE ALSO: <a href="https://www.businessinsider.in/stock-market/news/apple-surges-to-add-178-billion-in-market-value-as-4th-quarter-earnings-help-drive-a-turnaround-in-the-stock-market/articleshow/95153518.cms">Apple surges to add $178 billion in market value as 4th-quarter earnings help drive a turnaround in the stock market</a> <a href="https://www.businessinsider.in/stock-market/news/the-fed-will-hike-rates-too-far-and-tip-the-global-economy-into-a-recession-survey-of-economists-says/articleshow/95151308.cms">The Fed will hike rates too far and tip the global economy into a recession, survey of economists says</a> <a href="https://www.businessinsider.in/thelife/news/see-inside-an-almost-1-million-prefab-tiny-home-village-near-seattle-trying-to-solve-the-ongoing-homelessness-crisis/slidelist/95153993.cms">See inside an almost $1 million prefab tiny home village near Seattle trying to solve the ongoing homelessness crisis</a>

RBI can argue its case on inflation control say experts

Mumbai, Feb 14 () It is incumbent on the telcos to find money and will be safe to presume that they would have made some arrangements for it by now, SBI chairman Rajnish Kumar said on Friday. He also said that the bank will be passing on all the benefits of the cash reserve ratio (CRR) reliefs on small ticket loans to the borrowers and a decision on the same will be done before April 1. The comments on telecom companies come on a day when the Supreme Court made it clear that they will have to cough up the Rs 1.47 lakh crore in adjusted gross revenue (AGR) dues and also questioned why contempt proceedings should not be initiated against those who are coming in way of implementing its order. "It is now for the telecom companies to decide how will they find the money or what course of action they will take," Kumar told reporters on the sidelines of the annual NTLF here. "They (telcos) would have made their arrangements is what I presume," Kumar said, adding that it has not been approached by any of the telecom company. The payments to be made by the companies include Rs 53,000 crore by Vodafone Idea, Rs 35,500 crore by Bharti Airtel and Rs 14,000 crore by the now defunct Tata Teleservices. Kumar said the bank has a Rs 29,000 crore exposure to the telecom sector and another up to Rs 14,000 crore in non-fund based exposure which will devolve only if there is a non-payment of dues. Its gross non-performing assets include Rs 9,000 crore from the telecom sector, he said, adding that it has been provided for in full and the bank has decided not to set aside money against standard assets there. On the CRR benefit pass through, he said the next review of the external benchmark-linked rates is scheduled to take place in April 1, but an announcement will be made before that as well. The bank, at present, is calculating what exactly will be the benefit of the RBI's move announced on February 6 and the quantum of the benefit to the end customer will be soon arrived at. Meanwhile, on the troubles of Yes Bank, Kumar said SBI also had to contend with "mess" because of its corporate lending like the private sector lender, but could absorb the impact because of its size while the smaller sized Yes Bank suffered. The impact on both the banks was "more or less the same", he said. He claimed SBI is the biggest e-commerce player at present through its digital banking offering 'Yono' if one were to exclude pure-play players in the segment. The bank has done over Rs 14,000 crore of personal loans through the app and the interest and fees earned through it will help it recover the Rs 800 crore investment in the app, he said. It is on boarding an average of 70,000 users per day on Yono and will be hitting the 20 million mark soon, even before it celebrates the second anniversary of the offering, Kumar said. Taking potshots at new-age digital players, Kumar said a bank's valuation goes up when it reports profits, while it is losses that drive the valuations for new age entities. AA MRMR

SBI not approached by any telco to finance AGR dues, say chairman

New Delhi, Mar 27 () Finance Minister Nirmala Sitharaman on Friday asked banks for "quick transmission" of slashed interest rate as the RBI cut the key lending rate sharply by 75 basis points to boost liquidity in financial system to deal with the COVID-19 pandemic.In a tweet, the Finance Minister also welcomed RBI Governor Shaktikanta Das' statement that the macro economic fundamentals of the Indian economy are sound, and in fact stronger than what they were in the aftermath of the global financial crisis of 2008-09."Appreciate @RBI @DasShaktikanta's reassuring words on financial stability," she said.The three-month moratorium on payments of term loan instalments (EMI) and interest on working capital give much-desired relief, she added."...Slashed interest rate needs quick transmission," the Finance Minister said in another tweet.Meanwhile, welcoming the RBI's decision to provide three months moratorium on payment of term loans, Commerce and Industry Minister Piyush Goyal said said that amid this hour of need, the "move has provided a much needed relief to people and businesses".Besides other measures to help the economy facing lockdown, the RBI announced steps to release primary liquidity of Rs 1,37,000 crore in the banking system and reduced cash reserve ratio (CRR) by 100 basis points with effect from March 28 for one year. NKD BALBAL

Slashed interest rate needs quick transmission: FM

<ul class="summary-list"><li>The right to <keyword id="6357791" type="UNKNOWN" weightage="60" keywordseo="abortion">abortion</keyword> is protected under federal law, but state policies dictate varying levels of abortion access.</li><li>Some <keyword id="6359922" type="LOCATION" weightage="60" keywordseo="States">states</keyword>, like New York and California, have passed policies to expand abortion access and protect the right under state law.</li><li>Other states, namely those in the south and the Rust Belt, have historically been hostile to abortion.</li><li>TRAP laws, mandatory waiting periods, and gestational limits can all restrict access to abortion.</li></ul>A landmark <keyword id="6354977" type="ORGANIZATION" weightage="60" keywordseo="Supreme-Court">Supreme Court</keyword> case called Roe v. Wade protects the right to abortion without excessive government interference at the US federal level. But when it comes to state legislature, each jurisdiction has its own set of laws that affect access to abortion services.Since the appointment of conservative and historically <a href="https://www.businessinsider.com/fertility-doctors-oppose-barretts-nomination-fear-threats-to-ivf-2020-10">anti-abortion justice Amy Coney Barrett</a> to the Supreme Court, states such as Mississippi have sent <a href="https://www.kff.org/womens-health-policy/issue-brief/abortion-at-scotus-a-review-of-potential-cases-this-term-and-possible-rulings/">abortion rights cases</a> to the highest court in hopes of setting a new precedent for bans and restrictions.Louisiana and Colorado both posed ballot initiatives concerning abortion rights in the 2020 presidential election, with Louisiana officially <a href="https://www.fox8live.com/2020/11/04/abortion-amendment-passes-louisiana-heres-what-that-could-mean/">amending its state constitution</a> to explicitly not protect abortion and Coloradans declining to pass a ballot measure that would <a href="https://coloradosun.com/2020/11/03/colorado-abortion-measure-failing-in-early-returns-but-battle-is-still-too-close-to-call/">ban abortion after 22 weeks of pregnancy</a>.Elisabeth Smith, chief counsel of state policy and advocacy at the <a href="https://beta.reproductiverights.org/">Center for Reproductive Rights</a>, said although these state laws cannot outright ban abortion while it is protected at the federal level, they can seriously impact access to it."Federal law creates a floor that says abortion is a right, and then state law has the potential to either increase access or really prohibit access," she said.Here's a breakdown of how state laws either expand, protect, or restrict access to abortion in the US.<h2>New York, Vermont, Connecticut, California, Oregon, Washington, and Hawaii all have expanded access to abortion</h2>States that not only protect the right to abortion in their constitutions but also have removed barriers to getting a safe and legal abortion are considered expanded access states, according a <a href="https://reproductiverights.org/what-if-roe-fell">"What If Roe Fell?" tool</a> published by CRR.In 2019, New York passed a <a href="https://www.nysenate.gov/legislation/bills/2019/S240">reproductive health act</a> that protected the right to abortion under state law, ensuring that it would remain so even if Roe v. Wade was overturned. The law also removed abortion from the state penal code and allowed clinicians to perform abortions after 24 or more weeks of pregnancy if the mother's life is at risk or the fetus is not viable."If you look at a state like New York State, that, in state law, protects the right to abortion, allows advanced practice clinicians to provide abortion care, and covers abortion in a Medicaid program, you can see that they're pretty full access," Smith said.Allowing advanced practice clinicians such as physician assistants or nurse midwives to provide abortion care makes the service more widely available compared to states where only physicians have that power. Most expanded access states also require both private insurance and Medicaid to cover the cost of abortion care.However, some expanded access states - Connecticut, Vermont, Washington, and Oregon - still have TRAP laws, or laws imposed on abortion providers that are not required for other medical providers.<h2>14 other states and the District of Columbia protect the right to abortion</h2>As recently as 2019, states have recognized the right to abortion in laws and court precedents.Illinois passed <a href="https://www.nprillinois.org/post/other-states-restrict-abortion-rights-illinois-protects-and-expands#stream/0">comprehensive abortion legislation</a> in 2019, which not only protected the right to abortion but also repealed restrictive laws that required husbands to give consent for their wives and put doctors at risk of criminal penalties.Even in Kansas, where abortion remains heavily restricted, the state Supreme Court ruled that <a href="https://www.npr.org/2019/04/26/717449336/kansas-supreme-court-rules-state-constitution-protects-right-to-abortion">women have autonomy</a> over decisions that affect their bodies and <keyword id="6354750" type="UNKNOWN" weightage="100" keywordseo="health">health</keyword>. The state maintains a 22-week gestational ban and only allows certain methods of abortion.Alaska, Delaware, the District of Columbia, Florida, Iowa, Maine, Maryland, Massachusetts, Minnesota, Montana, Nevada, New Jersey, and Rhode Island also protect the right to abortion. Most of the states have imposed some degree of restriction, such as gestational limits or requiring young people to obtain parental consent.<h2>The right to abortion could be at risk in more than half of all US states if Roe v. Wade were overturned</h2>If Roe vs. Wade were challenged or overturned, abortion rights would be protected in less than half of the US states. Not all of these states restrict abortion access, but they all leave <keyword id="1110231" type="PERSON" weightage="60" keywordseo="reproductive-rights">reproductive rights</keyword> vulnerable under a majority-conservative Supreme Court.New Hampshire, Virginia, Wyoming, Colorado, and New Mexico do not protect abortion rights but are not considered hostile to abortion, according to CRR. Most of these states have some restrictions, such as <a href="https://law.lis.virginia.gov/vacode/title18.2/chapter4/section18.2-74/">Virginia's prohibition of third trimester abortions</a>.Colorado, however, is one of seven states that do not prohibit abortion at any point during pregnancy. Only one percent of abortions take place after 21 weeks, usually in cases of poor maternal health or an inviable fetus, according to the <a href="https://www.guttmacher.org/evidence-you-can-use/later-abortion">Guttmacher Institute</a>. But because abortions after that point are so restricted, women from across the country <a href="https://www.denverpost.com/2019/10/13/late-abortion-women-2020/">travel to Colorado</a> for later-term abortions.<h2>States in the south and the Rust Belt have historically been hostile toward abortion rights</h2>By regulating who can provide an abortion, when they can do it, and who has to pay for it, many states have established themselves as anti-abortion zones.Alabama has the most restrictive abortion law in the US, which bans abortion at any stage of pregnancy under any circumstance. District courts <a href="https://www.bbc.com/news/world-us-canada-50223637">ruled the law unconstitutional</a> in 2019, so it is currently on hold. In the meantime, Alabama maintains medically unnecessary restrictions, including mandatory ultrasounds at abortion appointments and a required <a href="https://www.guttmacher.org/state-policy/explore/counseling-and-waiting-periods-abortion">48-hour waiting period</a> before the procedure can take place. Arkansas, Kentucky, Louisiana, Mississippi, Missouri, North Dakota, South Dakota, and Tennessee all have so-called "trigger bans" that could prohibit abortion if Roe falls. However, Smith said the bans likely would not be put in place automatically as the name suggests, and would require some legal proceedings to pass.Read more:<a href="https://www.businessinsider.com/latest-point-in-pregnancy-you-can-get-abortion-in-50-states-2019-5">Here's the latest point in pregnancy you can get an abortion in all 50 states</a><a href="https://www.insider.com/long-acting-birth-control-options-to-consider-roe-v-wade-2020-10">4 long-acting birth control options to consider if the Supreme Court limits contraception and abortion access</a><a href="https://www.insider.com/the-abortion-pill-what-to-know-about-self-managed-abortions-2020-11">Everything you need to know about the abortion pill, according to a gynecologist</a>

How the states with the best access to abortion services compare to the worst

By Roopshree Nair New Delhi, Mar 19 () Industry body CII has asked its member companies not to lay off their employees, its president Vikram Kirloskar said on Thursday amid the coronavirus outbreak causing economic slowdown globally. His remarks come against the backdrop of mounting concerns that companies, including in India, could resort to retrenchment due to sluggish demand and various restrictions in place to curb spreading of the coronavirus infection.Observing that "times are challenging", Kirloskar said the industry has sought a moratorium on all loan repayments and urged the Reserve Bank to cut interest rates and increase liquidity in the system."We are requesting our members to hold on to their staff and not do layoffs as far as possible and take care of small service providers as far as possible," Kirloskar told in an interview.The Confederation of Indian Industry (CII) had 9,325 companies as members at the end of 2019.Among other sectors, the airline industry is one of the worst hit by the outbreak. GoAir has asked many employees to go on leave without pay on a rotational basis and has also terminated services of expat pilots.Country's largest carrier IndiGo has announced pay cuts and debt-laden Air India too is considering a similar step."If I compare with the rest of the world, I think our government has done a wonderful job," he said, and suggested that the government should do more to support the economy as India's supply chains have been hit, impacting exports.The coronavirus outbreak has impacted the whole world, and S&amp;P Global Ratings on Wednesday said the global economy has entered into a recession, while lowering the growth forecast for major countries, including India.Elaborating on what the industry wants from the government, Kirloskar said: "We have requested for support such as moratorium on loan repayments".Besides, both central as well as state governments should clear pending dues to micro, small and medium enterprises as fast as possible.He also said the Reserve Bank needs to have a "re-look" at the short-term lending rate, and relax the cash reserve ratio (CRR) requirements for banks so as to increase liquidity into the system.Earlier this week, RBI hinted at a rate cut but stopped short of a decision, belying market expectations at a hurriedly called presser, even as it announced some liquidity enhancing measures to contain the economic fallout of coronavirus.The central bank has started selling US dollars to banks through swap auctions to augment liquidity in the forex market amid the Indian rupee sliding significantly in comparison to the greenback.Kirloskar further said to deal with the contagious virus, industry has started talking about virtual board meetings so that business could go on without taking any health risk. RSN NKD CS NKD ANUANU

Don't lay off employees: Industry body tells member companies

<div class="KonaFilter image-container display-table float_right"><div><div class="image on-image"></div></div></div>People are starting to talk about a new danger in the Chinese financial system: asset-backed securities (ABS).An ABS is basically bond that might be collateralized by a number of things like loans, credit card debt, or a company's receivables. Many experts blamed a boom in ABS for helping inflate the credit bubble as it quickly turned liabilities into cash, while offering investors what appeared to be high yield at relatively low risk.China's trust companies have started buying ABS at a stunning rate, and with the same vigor with which they once bought <a href="http://www.businessinsider.com/investors-protest-chinese-wmps-2012-12">infamously dangerous wealth management products </a>(WMP), which are now on the decline.One recent Chinese Reserve Report (CRR) projects that financial firms could issue $127 billion in ABS this year, up from $44 billion worth last year."Showing a flexibility to reinvent themselves that a pre-2008 Wall Street investment bank would be impressed by, the trust companies that drove the now fading WMP boom are now becoming packagers of ABS," wrote CLSA analyst Christoper Wood in a recent note. As China has sought to clean up its banking sector, WMP's have fallen out of fashion, and for good reason. Years ago investors were told that these products offered risk-free returns of 2% and higher. That was often not the case, and angry investors would sometimes <a href="http://www.businessinsider.com/china-shadow-banks-2014-1">take to the streets to express their frustration.</a> But that doesn't mean investors stop chasing yield, of course. Wood continued: "As for what loans go into the ABS, a CRR analysis of 60 ABS products issued in 2014 found that most of them were focused on corporate loans... with the average yield 5.7% and the average maturity of the product 22 months. Meanwhile, an investor in an ABS does not have to wait until the product matures to get paid in the sense that he can sell it at any time, traded as ABS now are in the interbank market."That corporate debt part is where things get really worrisome. Corporate loans make up almost 92% of what goes into these ABS, but analysts have long argued that China's biggest debt problems lie in its corporate sector. They are the country's biggest borrowers, and unfortunately right now they're also under intense pressure. As the Chinese economy moves from one based on investment to one based on consumption, corporate margins have thinned. China's producer price index is at its lowest level since October 2009. Already this year we've seen massive Chinese property developer, Kaisa, default on bond payments. Now it looks like that debt is being repackaged and shipped around to investors at the worst time possible. <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/excel-index-match-vlookup-video-how-to-2015-2">This is what separates the Excel masters from the wannabes</a></h3> <div> <div> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="50YnY4czr4ms1vJ7yz3xzq0excz_pUMs" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> </div> </div> </div>

There's a new ticking time bomb building inside China's economy

<div class="KonaFilter image-container display-table float_right"><div><div class="image"></div></div></div>People are starting to talk about a new danger in the Chinese financial system: asset-backed securities (ABS).An ABS is basically bond that might be collateralized by a number of things like loans, credit card debt, or a company's receivables. Many experts blamed a boom in ABS for helping inflate the credit bubble as it quickly turned liabilities into cash, while offering investors what appeared to be high yield at relatively low risk.China's trust companies have started buying ABS at a stunning rate, and with the same vigor with which they once bought <a href="http://www.businessinsider.com/investors-protest-chinese-wmps-2012-12">infamously dangerous wealth management products </a>(WMP), which are now on the decline.One recent Chinese Reserve Report (CRR) projects that financial firms could issue $127 billion in ABS this year, up from $44 billion worth last year. <div class="margin-top"> <h3>NOW WATCH: <a href="http://www.businessinsider.com/end-fall-demise-mayan-civilization-new-evidence-2015-1">Scientists Discovered What Actually Wiped Out The Mayan Civilization</a></h3> <div> <div> <div class="ooyala-video-player" data-video-autoplay="false" data-video-id="55ampxcjoS7Wta3JMLFeUrzwVtgPrh0g" data-player-variable="ooyalapopvideo" id="ooyalaplayer_popvideo" style="width:1280px;height:720px"></div> </div> </div> </div>

You Searched For "what is CRR" and got 11 results

Decoded: Here’s how repo rate cut will help home-buyers and affect FD investors

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Aadhaar Gaining More Teeth, To Play Key Role In ‘Banking For All’

Sanghamitra Mandal

RBI measures controlled inflation, but challenges remain say economists

IANS

Every box in our wishlist is ticked says bankers on RBI’s rate cut and other moves

Katya Naidu

RBI can argue its case on inflation control say experts

IANS

SBI not approached by any telco to finance AGR dues, say chairman

PTI

Slashed interest rate needs quick transmission: FM

PTI

How the states with the best access to abortion services compare to the worst

Andrea Michelson

Don't lay off employees: Industry body tells member companies

PTI

There's a new ticking time bomb building inside China's economy

Linette Lopez

There's a new ticking time bomb inside China's economy

Linette Lopez

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