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Prime Minister <keyword id="19895781" type="General" weightage="20" keywordseo="narendra-modi" source="keywords">Narendra Modi</keyword> urged CEOs of US majors to take advantage of India's growth story as the country is making all efforts to become the third largest economy of the world in his third term. India is currently the fifth largest economy of the world after the US, China, Germany and Japan with a GDP of around USD 3.9 trillion. India has been the fastest growing large economies of the world with GDP growth rate of over 7 per cent for the last three consecutive years. Addressing CEOs of the large US tech firms on Sunday, Modi said India will make every effort to become the third largest economy in the world in his third term (2024-29). Companies should take advantage of India's growth story for collaboration and innovation by co-developing, co-designing, and co-producing in India for the world, harnessing the opportunities from the country's economic and technological growth, he said. Assuring the business leaders of India's deep commitment to the protection of intellectual property and to fostering tech innovation, Modi highlighted the economic transformation happening in the country, particularly in electronics and information technology manufacturing and semiconductors. Modi asserted that his government was committed to making India a "global hub of <keyword id="20073013" type="General" weightage="20" keywordseo="semiconductor-manufacturing" source="keywords">semiconductor manufacturing</keyword>". The meeting took place at the Lotte <keyword id="19904497" type="General" weightage="20" keywordseo="New-York" source="keywords">New York</keyword> Palace Hotel on Sunday during the second leg of Modi's three-day US visit. It saw the participation of CEOs of 15 major US-based firms working on cutting-edge technologies such as AI, quantum computing and semiconductors. "Had a fruitful roundtable with tech CEOs in New York, discussing aspects relating to technology, innovation and more. Also highlighted the strides made by India in this field. I am glad to see immense optimism towards India," Modi said in a post on X. During the conference, Modi said technology collaboration and efforts such as the Initiative on Critical and Emerging Technologies (ICET) lie at the core of the India-US Comprehensive Global Strategic Partnership, according to a Ministry of External Affairs press release. Organised by the Massachusetts Institute of Technology (MIT) School of Engineering, the CEOs of top US tech firms, including Google CEO Sundar Pichai, Adobe CEO Shantanu Narayena, Accenture CEO Julie Sweet and NVIDIA CEO Jensen Huang attended the meeting. Others who participated in the roundtable included AMD CEO Lisa Su, HP Inc. CEO Enrique Lores, IBM CEO Arvind Krishna, Dr Noubar Afeyan, Chairman of Moderna, and Verizon CEO Hans Vestberg. Modi also talked about India's BIO E3 (biotechnology for environment, economy and employment) policy to develop the country into a biotech powerhouse and on the topic of AI, noted that India's policy is to promote AI for all, underpinned by its ethical and responsible use. The CEOs appreciated India's growing prominence as a global technology hub, driven by its innovation-friendly policies and flourishing market opportunities. They also expressed strong interest in investing and collaborating with India, agreeing that investing in startups would be a synergistic opportunity to innovate and develop newer technologies in the country. Others who attended the conference included Biogen Inc CEO Chris Viehbacher, CEO of Bristol Myers Squibb, Chris Boerner, Eli Lilly and Company CEO David A. Ricks, LAM Research CEO Tim Archer, GlobalFoundries CEO Thomas Caulfield, and the CEO of Kyndryl, Martin Schroeter. "Further cementing technology and business connect. PM @narendramodi interacted with the top tech leaders and CEOs of USA, in a Roundtable hosted by the Massachusetts Institute of Technology School of Engineering, in New York today. PM emphasised India's growth prospects and discussed initiatives to foster collaborations and innovation across diverse sectors," the official account of the MEA said in a post on X. The prime minister had a separate meeting with Krishna P Singh, CEO of Holtec International, which is into nuclear and solar power generation. They discussed Holtec's plan for expanding manufacturing in India and advancing energy cooperation, PMO India said in a post on X. Earlier on Sunday, Modi addressed the <keyword id="20115166" type="General" weightage="20" keywordseo="Indian-diaspora" source="keywords">Indian diaspora</keyword> at the packed Nassau Veterans Coliseum on Long Island in New York. He also held bilateral meetings with world leaders at the sidelines of the UN General Assembly session here. Modi reached New York on Saturday after attending the Quad Leaders' Summit hosted by President Joe Biden in Wilmington, Delaware. <div type="Article" hostid="261" msid="113516805" title="Why is Indian Prime Minister Narendra Modi visiting the US this weekend?" mstype="2" mssubtype="0"></div>

PM Modi invites US CEOs to take a 'byte' out of India's growing technology sector

<ul class="summary-list"><li>This post originally appeared in the Insider Today newsletter.</li></ul>Welcome back! Summer vacation have you dreaming about giving it all up and moving abroad? Luckily, six European towns are <a target="_blank" rel="noopener" href="https://www.businessinsider.com/get-paid-to-move-to-europe-greece-spain-switzerland-italy-2024-7">offering cash to help you move there</a>.Speaking of money and vacations: In today's big story, summer vacation means financial stress for parents looking to keep their kids busy while school is out <a target="_blank" href="https://www.businessinsider.com/cost-summer-camp-childcare-inflation-parents-debt-work-schedules-2024-7">without breaking the bank</a>.What's on deck:<ul><li>Markets: The June jobs report is <a target="_blank" href="https://www.businessinsider.com/unemployment-rate-job-growth-june-economic-data-2024-7">good news for a potential rate cut</a>.</li><li>Tech: The founder of Gen Z's new favorite app details <a target="_blank" href="https://www.businessinsider.com/noplace-app-takes-over-apple-charts-myspace-twitter-for-genz-2024-7">how she plans to avoid being just a fad</a>.</li><li>Business: The three worst letters in real estate: <a target="_blank" href="https://www.businessinsider.com/abolish-hoas-homeowner-associations-housing-market-real-estate-costs-2024-7">HOA</a>.</li></ul>But first, hello campers!If this was forwarded to you, <a target="_blank" href="https://www.businessinsider.com/subscription/newsletter/insider-today">sign up here.</a><h3 id="7fa5f018-5b05-4a37-a8dc-d3f89138bcb3">The big story</h3><h2 id="5fd547b9-ec52-41fc-8e08-4f4b27dd8097">The cost of summer</h2><div type="image" title="illustration of coin on swan" height="880" width="1168" msid="111587548" hostid="261" sizebytes="82826"></div>School's out for summer, but the relief for kids is causing financial pain for their parents.Summer can be a money pit for parents scrambling <a target="_blank" href="https://www.businessinsider.com/cost-summer-camp-childcare-inflation-parents-debt-work-schedules-2024-7">to keep their kids entertained in July and August</a>, write Business Insider's Juliana Kaplan and Madison Hoff.Summer childcare isn't cheap. Nearly a quarter of recently surveyed parents with kids in a summer program said they expect to pay more than $1,000 a month per child this summer. And those costs can balloon well beyond that, with one family spending $6,000 for a three-week sleepaway camp.Further complicating things is most camps don't cover the two-plus months parents need to fill for their kids. The result is sometimes a patchwork system of camps and part-time nannies that parents need to cobble together.Sometimes costs crop up before camp even starts. Parents spend hundreds, or even thousands, on <a target="_blank" href="https://www.businessinsider.com/parents-spend-hundreds-summer-camp-packing-services-kids-2024-6">packing and prepping their kids before shipping them off</a>.Just about everyone feels the squeeze on their wallets when the temperature rises.An Intuit Credit Karma survey found 61% of parents with children under 18 said it "feels even more expensive to raise kids in the summer months."It's a brutal reality check for parents who thought their days of high childcare costs were behind them when they became DIPS (<a target="_blank" href="https://www.businessinsider.com/parents-paying-preschool-childcare-costs-new-term-dinks-dips-henry-2024-2">dual income, public school</a>).Instead, some are even going into debt, despite sky-high credit card interest rates, to make it work.<div type="image" title="Illustration of a teddy bear with makeup in front of campgrounds and cabins." height="1500" width="3000" msid="111587547" hostid="261" sizebytes="1234734"></div>Things don't always get easier once kids are at camp, though.This year, skincare products proved to be <a target="_blank" href="https://www.businessinsider.com/sephora-kids-sleepaway-camps-ban-expensive-skincare-beauty-products-2024-6">a lightning rod for kids and parents at elite summer camps</a>, writes BI's Anna Silman. Outright bans or restrictions on luxury skincare products — because nine-year-olds need their daily lip oil — created chaos among their tweens.Of course, drama comes with the price of admission at these fancy establishments, which can run $16,000 for the summer.In 2021, Anna reported on how parents were <a target="_blank" href="https://www.businessinsider.com/sleepaway-camp-photo-drama-tyler-hill-2021-7">up in arms over the daily photos shown from camp</a>. Parents inundated camp employees with concerned or critical emails and calls as they tried to parent their children from hundreds of miles away.<h3 id="77f31a4c-8462-4e3d-a71f-838cb79493fb">News brief</h3><h2 id="1fcd294b-3f53-425f-9f20-4093e8623b59">Your Monday headline catchup</h2>A quick recap of the top news from over the weekend:<ul><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/boeing-big-mea-culpa-just-dropped-does-not-look-pretty-2024-7">Boeing's big mea culpa just dropped and it doesn't look pretty.</a></li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/modi-putin-russia-india-relationship-not-worried-us-biden-mad-2024-7">Modi's Russia visit shows India isn't worried about making the US mad.</a></li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/joe-biden-should-not-drop-out-election-prediction-allan-lichtman-2024-7">Kamala Harris won't save Democrats if she takes over for Biden, warns historian who correctly predicted 9 of the last 10 elections.</a></li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/france-election-results-new-popular-front-2024-7">France's left-wing alliance blocks a far-right majority, projection shows.</a></li><li><a target="_blank" rel="noopener" href="https://www.businessinsider.com/russia-use-wwii-tactic-defend-against-ukrainian-drone-strikes-2024-7">Russia may resort to an old World War II tactic that had a key role in the D-Day landings to repel Ukrainian drone attacks.</a><a target="_blank" rel="noopener" href="https://www.businessinsider.com/mint-butterfield-teen-child-tech-founders-found-safely-police-2024-4">ded Slack and mom cofounded Flickr, found safe, police say</a>.</li></ul><h2 id="8120060b-ae66-48dc-b149-f0489a30ffa2">3 things in markets</h2><div type="image" title="man walking by power plants" height="546" width="1102" msid="111587552" hostid="261" sizebytes="147554"></div><ol><li>How to get in on the AI infrastructure trade everyone's talking about. You've read a lot about the role data centers and utilities play in powering AI. But where should you invest? <a target="_blank" href="https://www.businessinsider.com/ai-stocks-companies-building-out-infrastructure-goldman-sachs-picks-2024-7">Goldman Sachs identified 89 stocks across 10 sectors</a> that are key to AI infrastructure.</li><li>The June jobs report included a couple surprises. The US labor market added more jobs last month than expected (206,000). But an unexpected uptick in unemployment to 4.1% is good news for <a target="_blank" href="https://www.businessinsider.com/unemployment-rate-job-growth-june-economic-data-2024-7">investors hoping for an interest-rate cut</a>.</li><li>An activist short-seller's Pyrrhic victory. Hindenburg Research wiped out $150 billion in market value from the Adani Group when it accused the Indian conglomerate of sweeping fraud. Meanwhile, Hindenburg's rewards were meager: The short-seller made just $4 million for its efforts. <a target="_blank" href="https://www.businessinsider.com/hindenburg-research-adani-group-explained-stock-crash-short-seller-profits-2024-7">But its leader insists it's not about the money</a>.</li></ol><h2 id="f4b54806-7f81-450c-ba32-92560d4fae9b">3 things in tech</h2><div type="image" title="Phones with Noplace." height="553" width="738" msid="111587549" hostid="261" sizebytes="32544"></div><ol><li>Gen Z's new favorite social media is… MySpace 2.0? The app Noplace, which is going viral among young people, is a nod to the early days of social media before the "algos and ads" took over. <a target="_blank" href="https://www.businessinsider.com/noplace-app-takes-over-apple-charts-myspace-twitter-for-genz-2024-7">Its founder has a plan to keep it from fizzling out</a>.</li><li>How Andy Jassy secretly wooed Wall Street. After a rough start to his tenure as CEO, Jassy executed a stunning turnaround: He slashed costs, won over investors, and put a new stamp on Amazon's culture. More than a dozen employees, investors, and analysts explained <a target="_blank" href="https://www.businessinsider.com/amazon-andy-jassy-wooed-wall-street-overhauled-bloated-tech-giant-2024-7">how Jassy overhauled the tech giant for the better</a>.</li><li>Amazon laps Netflix in the race for TV ad dollars. Ad buyers told BI that <a target="_blank" href="https://www.businessinsider.com/amazon-beating-netflix-upfront-battle-for-tv-sports-dollars-2024-7">Amazon is leading streamers in the competition for advertisers</a>, thanks to its large sports footprint and lower prices. It also has a larger ad-supported audience, since it <a target="_blank" href="https://www.businessinsider.com/amazon-prime-video-preview-shake-up-tv-ad-marketplace-2024-1">switched on ads for all Prime Video users</a> in January.</li></ol><h2 id="9260fa45-d397-4b3c-b4f8-4bb193976216">3 things in business</h2><div type="image" title="Nosy neighbor with binoculars peeking over shrubs, shocked at neighbor's 'NO HOA' sign" height="900" width="1200" msid="111587555" hostid="261" sizebytes="92110"></div><ol><li>Down with homeowner associations. Millions of Americans live in neighborhoods with HOAs that operate as private quasi-governments. While a new Florida law has made strides to limit HOAs' power, it will take more than some modest adjustments. <a target="_blank" href="https://www.businessinsider.com/abolish-hoas-homeowner-associations-housing-market-real-estate-costs-2024-7">We may need to break the system entirely</a>.</li><li>Stay greasy, McDonald's. Over the course of many years, McDonald's forays into healthy alternatives haven't panned out. That's probably because no one is going there to enjoy a salad. Customers know that. McDonald's does, too — <a target="_blank" href="https://www.businessinsider.com/mcdonalds-should-stick-to-unhealthy-food-burgers-chicken-2024-7">and it shouldn't forget it</a>.</li><li>Gen Z in Neverland. A growing share of young Americans are living with their parents way past college, and relying on the Bank of Mom and Dad for support. But it isn't all their fault. Lacking social safety nets, <a target="_blank" href="https://www.businessinsider.com/gen-z-living-at-home-relying-on-parents-safety-net-2024-7">American parents are often left to provide cover</a>.</li></ol><h2 id="1ad7b482-3f4b-44b4-81b6-a864aa386478">In other news</h2><ul><li><a target="_blank" href="https://www.businessinsider.com/when-to-quit-six-figure-job-for-mental-health">3 high-earners share when they knew it was time to quit their 6-figure jobs: 'It was literally driving me to the edge.'</a></li><li><a target="_blank" href="https://www.businessinsider.com/samsung-apple-galaxy-iphone-battle-ai-intelligence-smartphones-2024-7">Samsung really wants to outsmart Apple in the Galaxy-iPhone battle</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/elon-musk-mocks-mark-zuckerberg-hydrofoil-video-2024-7">Elon Musk mocks Mark Zuckerberg's big hydrofoil swag moment and says he prefers to work instead of having fun on yachts</a>.</li><li><a target="_blank" href="https://markets.businessinsider.com/news/stocks/nvidia-stock-price-prediction-downgrade-ai-fully-valued-nvda-tech-2024-7">Why Nvidia just got a rare stock downgrade</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/hamptons-nightlife-clash-between-elite-clubs-and-angry-locals-2024-7">Elite nightclubs are forcing the Hamptons into an identity crisis</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/retire-early-expert-savings-advice-2024-7">I want to retire before 50, so I asked a financial planner for 3 ways to earn more on my savings</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/chase-warns-pay-free-services-checking-account-2024-7">Why your checking account may no longer be free</a>.</li><li><a target="_blank" href="https://www.businessinsider.com/tech-workers-real-winners-ai-talent-war-pay-2024-7">Tech workers look like the real winners of the AI talent war</a>.</li></ul><h2 id="9f5d80ac-3466-429f-a50a-2ffbb70c65ff">What's happening today</h2><ul><li>Samsung workers <a target="_blank" rel="noopener" href="https://www.reuters.com/technology/samsung-workers-union-south-korea-kicks-off-three-day-strike-2024-07-08/">began a three-day strike</a>.</li><li>Russian President Vladimir Putin met with Indian Prime Minister Narendra Modi.</li></ul>The Insider Today team: Dan DeFrancesco, deputy editor and anchor, in New York. Jordan Parker Erb, editor, in New York. Jack Sommers, deputy editor, in London. Annie Smith, producer, in London. Grace Lett, editor, in Chicago. Amanda Yen, fellow, in New York.

School's out, and parents' financial stress is in

Over the past few months, there’s been a lot of brouhaha about the lagging pace of bank deposits in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialization of household savings in the country, or the rising preference of Indians towards mutual funds and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian equity markets through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by <keyword id="20250971" type="General" weightage="20" keywordseo="franklin-templeton" source="keywords">Franklin Templeton</keyword>, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are <keyword id="4000333" type="General" weightage="100" keywordseo="household-deposits" source="Orion">household deposits</keyword> really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. Also, we can’t forego the fact that the share of Indian <keyword id="20319599" type="General" weightage="20" keywordseo="households" source="keywords">households</keyword> in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and savings account deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (<keyword id="19942037" type="General" weightage="20" keywordseo="central-board-of-direct-taxes" source="keywords">Central Board of Direct Taxes</keyword>) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of <keyword id="20930760" type="General" weightage="20" keywordseo="securities-transaction-tax" source="keywords">Securities Transaction Tax</keyword> (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell equity mutual funds, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by equities can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in deposit growth we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the <keyword id="19900043" type="General" weightage="20" keywordseo="fed" source="keywords">Fed</keyword> recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next <keyword id="19918491" type="General" weightage="20" keywordseo="mpc" source="keywords">MPC</keyword> (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day.

A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<div type="image" title="Are Indians depositing less money in banks, or more in mutual funds? Turns out, it&amp;#39;s neither of those." msid="113663806" hostid="261" sizebytes="1121785"></div> Over the past few months, there’s been a lot of brouhaha about the lagging pace of <keyword id="20202062" type="General" weightage="20" keywordseo="bank-deposits" source="keywords">bank deposits</keyword> in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialisation of <keyword id="20751315" type="General" weightage="20" keywordseo="household-savings" source="keywords">household savings</keyword> in the country or the rising preference of Indians towards <keyword id="19929240" type="General" weightage="20" keywordseo="mutual-funds" source="keywords">mutual funds</keyword> and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian <keyword id="19949641" type="General" weightage="20" keywordseo="equity-markets" source="keywords">equity markets</keyword> through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords" meta.keywordsubtype="org" meta.entityname="RBI" meta.hostid="261" meta.entityid="RBI">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by Franklin Templeton, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are household deposits really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. <div type="image" title="Yes, household deposits (as % of total deposits) have dipped, but the drop is far from significant" msid="113663882" hostid="261" sizebytes="306706"></div> Also, we can’t forego the fact that the share of Indian households in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and <keyword id="114757" type="General" weightage="20" keywordseo="savings-account" source="Orion">savings account</keyword> deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (Central Board of Direct Taxes) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of Securities Transaction Tax (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell <keyword id="6361918" type="General" weightage="20" keywordseo="equity-mutual-funds" source="Orion">equity mutual funds</keyword>, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by <keyword id="45369" type="General" weightage="20" keywordseo="equities" source="Orion">equities</keyword> can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in <keyword id="19998084" type="General" weightage="100" keywordseo="deposit-growth" source="keywords">deposit growth</keyword> we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the Fed recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next MPC (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day. Do you have insights or personal experience to share on your personal finances or money? Contact us at <a target="_blank" class="c-link" href="mailto:businessinsider@timesinternet.in">businessinsider@timesinternet.in</a>.

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<div type="image" title="Companies are embracing the unbossing trend" msid="113256383" hostid="261" sizebytes="1440779"></div> If there’s one thing both a productive team member and an underperformer hates in the corporate world, it’s being micromanaged. Now, imagine a workplace where the boss isn’t calling all the shots. Instead, everyone has a voice, and innovation flows freely. The recent corporate trend of "Unbossing" promises to do just that, empowering employees by eliminating the heavy hands of hierarchy. Sounds too good to be true? Well, globally, not just the new-age start-ups, but dozens of major corporations have embraced this trend and trimmed their middle management. <h2>Managers managing managers — no more!</h2>In January last year, <keyword id="399907" type="General" weightage="20" keywordseo="META" source="Orion">Meta</keyword> CEO Mark Zuckerberg made headlines for declaring 2023 as the “year of efficiency” and saying that he doesn’t want a management structure that's just “managers managing managers”. <div type="image" title="Meta CEO Mark Zuckerberg" agency="ANI" msid="113256403" hostid="261"></div> The same month, it was also reported by Command Line that Meta's chief product officer Chris Cox, had shared a post on the company's communication platform, Workplace, highlighting the necessity to "flatten" the organisation's structure. What followed was reports of Meta slashing middle management roles. Gradually, other companies like Shopify, Bayer, and Cisco began making headlines for showing the exit door to some of their middle managers. Loosely, unbossing is essentially cutting down the middle management roles. It cuts significant costs for the company and the new-age workforce also endorses the trend as efficient in enabling faster decision-making and innovation. However, critics argue this trend also limits the extent of mentorship that the younger generation receives while entering the workforce, which often remains an intangible value if your boss turns out to be a good mentor. Therefore, for some, it’s not about firing the middle management, but just another leadership philosophy on how leaders (and ‘bosses’) should conduct themselves. This approach advocates bosses working along with the team as a part rather than shouting instructions from the top. Whatever one’s understanding, this trend of “Unbossing” appears to be taking corporate America by storm in 2023, as evidenced by hundreds of media reports highlighting the same. Overall, most agree that the trend is restructuring organisational hierarchy to enable direct communication between employees and leaders. Cut to 2024, this trend is still prevalent and making headlines. A Bloomberg report recently said that Georges Elhedery, the incoming CEO of HSBC Holdings, might also consider plans to streamline the company's operations by reducing layers of middle management. But what’s the scenario in India? Are Indian companies ready to ditch the old-school approach and adopt this new way of working? Let’s dive in and see what the experts have to say! <h2>Layoffs to impact senior professionals: Naukri.com survey</h2>A survey by job portal Naukri.com early last year had suggested that recruiters in India expect a decline in layoffs during the first half of 2023. The survey, which included responses from 1,400 recruiters and consultants across ten industries, revealed that only 4 percent of participants anticipated layoffs to be the main focus of hiring activities within their organisations. However, the survey also highlighted that information technology roles and senior professionals were likely to be the most affected by hiring adjustments. About 20 percent of recruiters predicted that layoffs would predominantly impact senior professionals, while freshers are expected to face the least disruption from these hiring corrections. Interestingly the survey came around the same time when the Unbossing trend had begun picking up pace abroad. <h2>Layoffs at Wipro, <keyword id="18635" type="General" weightage="20" keywordseo="amazon" source="Orion">Amazon</keyword> and Collegedunia</h2>In January this year, Wipro India was in the limelight for laying off hundreds of its mid-level executives. The company reportedly culled many jobs as part of its strategy to improve margins. An ET report citing two sources familiar with the situation had said that the leading Indian IT firm reduced mid-level roles at its onsite locations. "Notices began being issued earlier this month, and hundreds of mid-level executives onsite are being let go," one source revealed. Another source added, "They have costly resources onsite in Capco, and although growth is returning, it's not sufficient. Aparna Iyer, Wipro's chief financial officer, has been tasked with delivering better margins this quarter." <div type="image" title="Amazon decided to lay-off middle managers in May" msid="113256170" hostid="261"></div>Then in May, Amazon also decided to reduce layers of middle management within its customer service divisions as part of an organisational restructuring, a Fortune report had said. The cuts impacted over 100 customer service managers in Level 5 and Level 6 middle management roles, both in call centres and virtual positions, primarily based in the U.S. and India. Not just large tech companies, startups too seem to be adapting the <keyword id="23125775" type="General" weightage="100" keywordseo="unbossing-trend-in-India" source="Orion">unbossing trend in India</keyword>. Last month, educational portal Collegedunia confirmed that around 100 employees from its Study Abroad department had been given the pink slip. A report in CNBC-TV18 had said that additional job cuts were happening across other departments as part of a broader reorganisation. The restructuring, as per the report, was aimed at automating many tasks to reduce costs. Interestingly, despite the layoffs, Collegedunia had posted 13 job openings on LinkedIn for various roles in different locations, primarily entry-level positions requiring up to two years of experience. "While Collegedunia is laying off several employees, it is also hiring fresh talent, allowing them to keep staffing levels up but at a lower cost," one employee told CNBC-TV18 at the time. Another source confirmed that while Collegedunia had been actively recruiting for some months, it has also been letting go of employees, including senior staff members with 7-8 years of experience at the company. <h2>What do experts say?</h2> <div type="image" title="Experts&amp;#39; opinion on unbossing trend" msid="113256250" hostid="261"></div>Mr. Sumit Kumar, Chief Strategy Officer at TeamLease Degree Apprenticeship, told Business Insider India, “From the perspective of HR leaders and CEOs, the strategic culling of middle management is viewed as a means to streamline operations, reduce overhead, and foster a culture of autonomy and innovation.” He also noted that even though employees can “exercise greater ownership and agility in decision-making” through this approach, there are also significant downsides. “The erosion of middle management creates a vacuum in leadership development, mentorship, and the retention of institutional knowledge, potentially leading to disengagement, a weakened talent pipeline, and misalignment with organisational objectives,” Kumar noted. Talking specifically about the Indian scenario, he said, “Implementing this trend in India would be a strategic move, positioning organisations to remain competitive in a rapidly evolving business environment. However, to fully capitalise on this approach, developing a more robust talent pipeline that integrates the ability to multitask at all levels is imperative. In today's landscape, leadership demands thinkers, strategic visionaries, and individuals who can execute with precision. We need to cultivate a new breed of leaders who are both thinkers and doers, capable of navigating complex challenges while driving innovation and growth. By building versatile, agile leaders through targeted talent development programs, Indian organisations can ensure they are well-prepared to thrive in a decentralised, high-performance environment.” RP Yadav, Chairman and Managing Director of Genius Consultants Limited, told ET recently that the Unbossing approach simplifies hierarchies and encourages open communication between frontline employees and senior management. He had added that the concept of “the oldest in the room is always the wisest of all” is no longer applicable. Meanwhile, Aditya Narayan Mishra, MD and CEO of CIEL HR Services told ET that the unbossing trend is predominantly seen in tech companies, creative roles, and startups, where swift decision-making and the unrestricted exchange of ideas are crucial. For example, the tech sector often thrives with flattened hierarchies that support rapid innovation and agility, while creative industries such as advertising and media use unbossing to cultivate a more collaborative and idea-focused environment. Thus, the unbossing trend is gaining traction beyond global companies and is finding its way into Indian organisations as well. While this approach can streamline operations, reduce costs, and enhance agility, experts caution that it also brings challenges, such as gaps in leadership development and the loss of institutional knowledge. To fully harness the benefits of unbossing, Indian companies must focus on cultivating agile leaders who can navigate complex challenges and drive growth. By building a strong talent pipeline and fostering a culture of innovation and collaboration, Indian organisations can position themselves to thrive in a more decentralised and dynamic business environment. Do you have insights or personal experience to s hare on layoffs, <keyword id="34447" type="General" weightage="20" keywordseo="workplace-trends" source="Orion">workplace trends</keyword>, or career changes? Contact us at businessinsider@timesinternet.in.

SIMPLY PUT: What’s with all “Unbossing” talks? Are Indian companies also embracing this global trend?

<keyword id="22362521" type="General" weightage="20" keywordseo="tourists-travellers" source="keywords">Tourists Travellers</keyword> from India have taken to <keyword id="20166206" type="General" weightage="20" keywordseo="international-travel" source="keywords">international travel</keyword> with newfound enthusiasm over the past two years, a new report by ride-hailing platform <keyword id="19895382" type="General" weightage="20" keywordseo="Uber" source="keywords" meta.keywordsubtype="org" meta.entityname="Uber" meta.hostid="261" meta.entityid="Uber">Uber</keyword> revealed on Wednesday. Indians travelled close to 1,000 cities across 68 countries significantly broadening their horizons, the report revealed. Their top destinations, however, remained consistent in the United States, the United Kingdom, and Canada. As per the report the <keyword id="22362520" type="General" weightage="20" keywordseo="summer-holiday-period" source="keywords">summer holiday period</keyword> when schools and colleges break, emerged as the prime time for these adventures for Indians. Interestingly, it said May 2023 outpaced June 2022 as the most popular month for <keyword id="21753645" type="General" weightage="20" keywordseo="overseas-travel" source="keywords">overseas travel</keyword>, indicating a shift in vacation timing. While abroad, Indians traveled longer distances, averaging 25 per cent more distance than their trips back home. Their Uber journeys spanned 21 different products, from premium electric vehicles like Comfort Electric to multimodal transit options that integrate trains and other mass transit modes, along with the ubiquitous UberX. The report underscores a significant uptick in the number of Indians using Uber internationally, with 2023 seeing Indian travellers ranking second only to Americans in terms of app usage abroad. During the ongoing summer travel season, Indians are expected to cross records set in the previous years, the report predicted. Moreover, many countries frequented by Indians support peer-to-peer ridesharing, allowing individuals to use their personal vehicles for Uber rides. This not only highlights the global appeal of the <keyword id="19913761" type="General" weightage="20" keywordseo="gig-economy" source="keywords">gig economy</keyword> but also showcases the country's adaptability and enthusiasm for diverse transportation options, the report noted. Commenting on the trend, Prabhjeet Singh, President, Uber India and <keyword id="19897710" type="General" weightage="20" keywordseo="south-asia" source="keywords">South Asia</keyword>, said, "Indians have been breaking all travel records over the past couple of years, and it's heartwarming to see how Uber continues to be their trusted last-mile partner in these travels. Be it the familiarity when landing at an airport in a new city or the safety when riding late at night, it's a huge mark of trust for us to see Indians book an Uber for their overseas travels."

Indians are travelling abroad like never before: Uber study

Are you one of the many who trade the hectic weekday grind for weekend relaxation, only to be met with a throbbing <keyword id="19957279" type="General" weightage="20" keywordseo="headache" source="keywords">headache</keyword>? The dreaded “weekend headache” or “weekend migraine” are often triggered by changes in routine and <keyword id="19983121" type="General" weightage="20" keywordseo="stress" source="keywords">stress</keyword> levels between weekdays and weekends — when the pressure valve finally releases, resulting in the so-called let-down effect. <h2>Why weekends hit back</h2>The primary trigger for a let-down or <keyword id="22663679" type="General" weightage="20" keywordseo="weekend-migraine" source="keywords">weekend migraine</keyword> is a sudden decrease in stress levels. This might sound counterintuitive, but your body reacts to the drastic shift from high tension to relaxation. During stressful periods, your body releases cortisol, a hormone that helps manage stress and reduce pain. But when the weekend arrives and the pace slows down, <keyword id="3733104" type="General" weightage="20" keywordseo="cortisol-levels" source="Orion">cortisol levels</keyword> dip, leaving our heads vulnerable to the <keyword id="20080248" type="General" weightage="20" keywordseo="migraine" source="keywords">migraine</keyword> attack. Other common triggers include: Anxiety: High anxiety levels can increase the risk of frequent headache episodes. Changes in sleep patterns: Both lack of sleep and excessive sleep can trigger headaches. Dietary factors: Consuming inflammatory seed oils like vegetable or canola oil can increase omega-6 levels, raising migraine risk. Low protein and omega-3 fat intake, as well as high carbohydrate and sugar consumption, are also linked to increased migraine episodes. Caffeine withdrawal can also trigger a let-down migraine. Specific foods: Foods rich in tyramine (e.g., cheese, kimchi, lemon, tofu, pickled beets), beta-phenylethylamine (e.g., chocolates, cocoa beans, eggs, natto, beans, herbs), and nitrates (e.g., leafy greens, processed meats) have been linked to migraines. <h2>India as the headache hotspot</h2>A <a href="https://thejournalofheadacheandpain.biomedcentral.com/articles/10.1186/s10194-023-01619-9" data-type="tilCustomLink">study</a> on global migraine incidence overview trends from 1990 to 2019 revealed that India had the highest number of headache instances recorded in adults between the ages of 22 and 45 worldwide. Sadly, the pandemic, which came in 2020, likely only worsened the situation. According to the <a href="https://www.bayer.in/en/news/indians-report-rise-in-stress-levels-post-pandemic-new-saridon-headache-report" data-type="tilCustomLink" target="_blank">Saridon Headache Report</a> from 2023, the COVID-19 pandemic has significantly impacted stress levels. The report indicates that 1 in 3 people felt their stress levels increased post-pandemic, with 93% of individuals recognizing that increased stress levels affect the frequency and severity of their headaches. In fact, Mumbai emerged as the headache capital, with over 90% of residents reporting headaches. While not restricted to just the weekends, some research suggests that children are also increasingly suffering from similar headaches. In 2019, researchers reported that about 58.4% of school-going children are the victims of migraine, tension-type headaches, chronic daily headache, <keyword id="22663681" type="General" weightage="20" keywordseo="cluster-headache" source="keywords">cluster headache</keyword>, etc. <h2>When to seek help</h2>Popping a pill is usually our quick-fix for such headaches. And while occasional weekend migraines might be manageable, and not entirely worth a trip to the doctor’s, it is essential to watch for warning signs. Consult your primary healthcare provider if: <ul><li>Your migraines become more frequent or severe.</li><li>Over-the-counter pain relievers lose their effectiveness.</li><li>You experience new or unusual symptoms.</li></ul>Remember, understanding your triggers and making lifestyle adjustments can significantly reduce the frequency and severity of weekend migraines. With proper management, you can reclaim your weekends and enjoy the relaxation you deserve. <div type="Article" hostid="261" msid="108617638" title="Headaches, acidity, eyesight issues &amp;amp; more — working for over 52 hrs/wk is taking its toll on Indian techies" mstype="2" mssubtype="0"></div>

You Searched For "Indian schools" and got 7 results

PM Modi invites US CEOs to take a 'byte' out of India's growing technology sector

PTI

School's out, and parents' financial stress is in

Dan DeFrancesco

A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

Ira Alok Puranik

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

Ira Alok Puranik

SIMPLY PUT: What’s with all “Unbossing” talks? Are Indian companies also embracing this global trend?

Divyanshi Sharma

Indians are travelling abroad like never before: Uber study

ANI

Weekend headaches plague many Indians, but how seriously should you take them?

Ashmita Gupta

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