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Prime Minister Narendra <keyword id="19899684" type="General" weightage="20" keywordseo="Modi" source="keywords">Modi</keyword> on Friday said the government is making necessary <keyword id="20861068" type="General" weightage="20" keywordseo="policy-changes" source="keywords">policy changes</keyword>, like removal of <keyword id="20279287" type="General" weightage="20" keywordseo="Angel-Tax" source="keywords">Angel Tax</keyword>, to promote the <keyword id="19945816" type="General" weightage="100" keywordseo="fintech" source="keywords">fintech</keyword> sector, even as he asked the <keyword id="19962476" type="General" weightage="20" keywordseo="regulators" source="keywords">regulators</keyword> to take additional measures to check cyber frauds which can have a crippling impact on startups. Lauding the fintechs for democratising <keyword id="19976433" type="General" weightage="20" keywordseo="financial-services" source="keywords">financial services</keyword>, Modi said the sector, which has attracted USD 31-billion investment in the last 10 years, has played a key role in denting the parallel economy. The Prime Minister was addressing the Global Fintech Fest (GFF) 2024, jointly organised by the Payments Council of India, the National Payments Corporation of India and the Fintech Convergence Council. He said the domestic economy and the capital market are in a celebratory mood at a time when the nation is also going through a festive period. Modi underlined that the government is making all necessary changes on the policy level to assist the fintech sector and gave examples of doing away with Angel Tax, allocating Rs 1 lakh crore to encourage research and innovation in the country and implementing the Digital Personal Data Protection Act. Broadly, fintech refers to entities utilising technologies for providing financial services. Expressing the need to put an end to <keyword id="19901142" type="General" weightage="20" keywordseo="cyber-fraud" source="keywords">cyber fraud</keyword>, he urged the regulators to take major initiatives to boost digital literacy. It is equally important to ensure cyber fraud does not come in the way of the growth of fintech and startups in the country, Modi said. In his speech, the Prime Minister also cautioned about the dangers of a parallel economy for the world. Fintech, he said, has played an impactful role in denting such a system and credited the emergence of transparency. He said that digital technology has introduced transparency in India and gave the example of the implementation of Direct Benefit Transfer used in hundreds of government schemes that has prevented leakages in the system. "Today, people can see the benefits of aligning with the formal banking system," he said. Modi further said the trinity of Jan Dhan, Aadhaar and Mobile have broken down the mentality of 'Cash is King' and made way for approximately half of the <keyword id="20004116" type="General" weightage="20" keywordseo="digital-transactions" source="keywords">digital transactions</keyword> in the world taking place in India. "India's <keyword id="19900911" type="General" weightage="20" keywordseo="upi" source="keywords">UPI</keyword> has become a major example of fintech in the world," he said, adding that it has enabled 24X7 banking services in every village and city in all weather conditions. Underlining the role of fintech in democratising financial services, the Prime Minister gave examples of readily available loans, credit cards, investments and insurance. He said that fintech has made access to credit easy and inclusive, and gave the example of PM SVANidhi scheme that has enabled street vendors to avail collateral-free loans and further expand their business with the help of digital transactions. "Sustainable <keyword id="19900794" type="General" weightage="20" keywordseo="economic-growth" source="keywords">economic growth</keyword> is India's priority today," he said and emphasised that the government is creating robust, transparent and efficient systems to strengthen financial markets with advanced technologies and regulatory frameworks. About 800 speakers, including policymakers, regulators, senior bankers, industry captains, and academicians, from India and other countries are participating in the fest.

Removed Angel Tax, taking policy measures to promote fintech sector: PM Modi

<ul class="summary-list"><li>The US Securities and Exchange Commission isn't happy with Elon Musk.</li><li>The financial regulator thinks Musk blew off court-ordered testimony to attend a SpaceX launch, according to a court filing.</li></ul>The US Securities and Exchange Commission wants a federal judge to show <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk">Elon Musk</a> that there will be serious costs if he blows off court-ordered testimony in the agency's probe of his <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-twitter">takeover of Twitter</a>, according to court documents filed Friday."Without further action by the Court, nothing deters Musk from violating the May 31, 2024 Order again by simply failing to show up for that date," Robin Andrews, an SEC attorney, wrote in a court filing.For now, the SEC does not want to sanction Musk; it just wants the <a target="_blank" href="https://www.businessinsider.com/elon-musk-twitter">X</a> owner to know that he will face repercussions if he misses his now-rescheduled testimony early next month.The commission is investigating Musk's 2022 acquisition of Twitter, later rebranded as X. The SEC has previously disclosed that it is investigating whether Musk violated securities law by secretly amassing Twitter stock in 2022 and statements he made before the ultimately successful $44 billion deal was finalized. Musk had tried to resist the SEC's efforts to compel him. US Magistrate Judge Laurel Beeler said in February that Musk viewed the SEC's investigation as "baseless and harassing."The SEC and Musk, who have <a target="_blank" class="" href="https://www.businessinsider.com/supreme-court-rejects-elon-musk-remove-twitter-sitter-sec-2024-4">tussled repeatedly</a> in the past, disagree on whether Musk blew them off when his attorneys told the agency he could not show up for previously scheduled testimony in California on September 10 because he needed to attend a <a target="_blank" class="" href="https://www.businessinsider.com/spacex-elon-musk">SpaceX</a>'s Polaris Dawn launch in Florida.Andrews' filing said that Musk's attorneys sent their request to reschedule his testimony just three hours before he was scheduled to testify at the SEC's Los Angeles office. In the regulator's view, Musk should have known about the launch and made proper arrangements beforehand."Despite this advance knowledge, Musk did not notify the SEC of his intent to attend the launch until three hours before his testimony was to begin, and after the SEC spent thousands of dollars to fly three attorneys to Los Angeles," the filing said.Musk's attorney, Alex Spiro, responded that the SEC's intent to seek sanctions is a "drastic action" that is inappropriate at this time. Spiro also argued that Musk's attendance at the SpaceX launch was exactly the type of emergency that the court order agreed could lead to rescheduling."The parties have already rescheduled the testimony for approximately three weeks after the original date, an immaterial amount of time in the context of an investigation that began two and a half years ago," Spiro wrote in his part of the joint statement to the court. "Any request for sanctions should be denied."In response to Business Insider, Spiro continued to dismiss the SEC's efforts."The last time the SEC went hysterically running into court, they were told to 'put their big boy pants on,'" Spiro wrote in an email to BI.The SEC declined to comment on Spiro's claim.Musk's contempt for the SEC is well documented.In 2018, he lashed out after a settlement with the regulator led him to step down as chairman of Tesla for three years and to pay a $20 million fine. The agreement did not require Musk or Tesla to admit to or deny the SEC's allegations related to his tweet where he claimed to have "secured" funding to potentially take Tesla private at $420 a share."Just want to that the Shortseller Enrichment Commission is doing incredible work," Musk wrote on Twitter. "And the name change is so on point!"

SEC is unhappy that Elon Musk did not give testimony to the financial regulator to attend a SpaceX launch

The United States government isn’t holding back when it comes to Big Tech, and <keyword id="19902762" type="General" weightage="20" keywordseo="Google" source="keywords" meta.keywordsubtype="org" meta.entityname="Google" meta.hostid="261" meta.entityid="Google">Google</keyword> is squarely in its sights. After years of concern over the tech giant’s grip on the digital world, the US Justice Department (DOJ) has made a bold demand: sell your Chrome browser. The move comes amid two high-stakes antitrust trials that accuse Google of monopolistic practices. So, what’s at the heart of the government’s case, and why is Chrome a key piece of the puzzle? Let’s break it down. <h3 style="line-height:1.38;margin-top:14.0pt;margin-bottom:4.0pt;">Search, Chrome, and monopoly madness</h3>In one corner, we have the DOJ versus Google in a trial in Washington, D.C., where a judge has already ruled that Google’s search business operates as an illegal monopoly. The DOJ argues that Google’s dominance in search, bolstered by its Chrome browser, gives the company an unfair advantage, effectively locking in users and advertisers. To remedy this, the DOJ has proposed that Google sell off Chrome entirely. This drastic move, they argue, could level the playing field and restore competition to a market where Google currently reigns supreme. <h3 style="line-height:1.38;margin-top:14.0pt;margin-bottom:4.0pt;">The ad tech tug-of-war</h3>Meanwhile, in Virginia, a second trial focuses on Google’s grip on the ad tech market — the engine behind the ads you see while browsing. The government alleges that Google’s trio of advertising software products effectively monopolises the ad tech ecosystem. Publishers like News Corp and Gannett claim they’re stuck using Google’s ad tools to survive. DOJ lawyer Aaron Teitelbaum summed it up bluntly: “Google is once, twice, three times a monopolist.” The DOJ accuses Google of using its financial clout to buy out rivals and control the auction systems that determine which ads appear online. This, they say, allows Google to charge advertisers more while paying publishers less. The government wants Google to divest parts of its ad tech business to dismantle this stranglehold. <h3 style="line-height:1.38;margin-top:14.0pt;margin-bottom:4.0pt;">Google fights back</h3>Unsurprisingly, Google has a different story. The tech giant calls the government’s arguments an attempt to pick “winners and losers” in an already competitive market. “The law simply does not support what the plaintiffs are arguing in this case,” said Google’s lawyer Karen Dunn. Google also argues that the ad tech market isn’t as straightforward as the DOJ claims. The company points out that ads appear across multiple platforms — search engines, social media, and apps — and Google doesn’t dominate all of them. In fact, it says rivals like Meta, Amazon, and TikTok are gaining ground. Dunn warned that forcing Google to sell parts of its business or work with competitors would essentially amount to government interference. “This is central planning,” she said, urging the court to reject the DOJ’s proposals. <h3 style="line-height:1.38;margin-top:14.0pt;margin-bottom:4.0pt;">What’s at stake?</h3>If the court rules against Google, the implications could be seismic. The DOJ’s proposals — selling Chrome or divesting parts of Google’s ad business — would fundamentally reshape how the company operates. But don’t expect a resolution anytime soon. Presiding Judge Leonie Brinkema is expected to issue her opinion swiftly, but any decision will almost certainly be appealed, dragging the case potentially to the US Supreme Court. Even then, the question of enforcement remains murky. While the Biden administration is eager to rein in Big Tech, future administrations could change course. Whether Google will ultimately be forced to sell Chrome or parts of its ad tech business is up to the courts — and potentially years of appeals. For now, the trials highlight a growing unease with the power of tech giants like Google. For Google, the stakes couldn’t be higher. For the rest of us, these decisions will shape the future of the internet as we know it. Stay tuned — this battle is far from over.

Why does the US want Google to sell its Chrome browser?

Amid the ongoing geopolitical tension, the <keyword id="19904988" type="General" weightage="20" keywordseo="energy-sector" source="keywords">energy sector</keyword> will continue to face challenge while the <keyword id="20468174" type="General" weightage="20" keywordseo="consumer-goods" source="keywords">consumer goods</keyword>, automotive, healthcare is set to expand in 2025, highlighted a report 'Industry Outlook 2025' by <keyword id="20618515" type="General" weightage="100" keywordseo="Economist-Intelligence-Unit" source="keywords" meta.keywordsubtype="org" meta.entityname="Economist Intelligence Unit" meta.hostid="261" meta.entityid="Economist Intelligence Unit">Economist Intelligence Unit</keyword>. The report noted that the Fossil fuel markets will continue to face risks from geopolitical conflicts, particularly in the Middle East and Ukraine. However, investments in <keyword id="19895602" type="General" weightage="20" keywordseo="renewable-energy" source="keywords">renewable energy</keyword> will remain strong, especially in China, as the world pushes toward cleaner and more sustainable energy sources. The report said "Fossil-fuel markets will continue to face <keyword id="20064250" type="General" weightage="20" keywordseo="geopolitical-risks" source="keywords">geopolitical risks</keyword> amid conflicts in the Middle East and Ukraine, but investment into renewables will remain strong, particularly in China." It also added that the financial sector faces a mixed outlook with falling interest rates anticipated to narrow bank profit margins, potentially leading to smaller dividend payouts for shareholders. Yet, regulatory easing could provide relief, with the Basel III endgame likely seeing further delays, softening the impact on banking institutions amid a challenging economic landscape. For the consumer goods and retailing the report added that the Global retail volumes are forecast to grow by 2.2 per cent in 2025, thanks to easing inflation. However, stricter regulations on online retailing will target high-volume, low-price retailers, to ensure fair competition and consumer protection. It said "Global retail volumes will expand by 2.2 per cent, helped by disinflation, but regulations around online retailing will tighten further" As per report, the <keyword id="20359760" type="General" weightage="20" keywordseo="automotive-sector" source="keywords">automotive sector</keyword> is set for a record year, it said "After a difficult few years, annual new-vehicle sales will reach a record 97.2m units in 2025. This includes a 2 per cent rise in new car sales, a 4 per cent increase in commercial vehicle sales, and a significant 16 per cent growth in <keyword id="19963112" type="General" weightage="20" keywordseo="electric-vehicle-sales" source="keywords">electric vehicle sales</keyword>, reflecting the sector's recovery and the shift toward cleaner mobility. In technology the report added more countries will adopt satellite internet, although the primary users will be enterprise clients, including military and maritime sectors. Amazon's Project Kuiper will challenge the existing market dominance of Starlink and EutelSat OneWeb, offering more competition and potential growth in satellite connectivity. The resulting tensions will continue to affect investment into production and market entry, with companies taking advantage of government incentives to build out more flexible supply chains. <keyword id="23684177" type="General" weightage="20" keywordseo="investment-in-technology" source="keywords">Investment in technology</keyword>, particularly artificial intelligence (AI), will also be strong as projects gather pace. However, technology companies will face pressure from several directions as regulations tighten (particularly in Europe), investors become more impatient for profits and their energy usage comes under more scrutiny.

Consumer goods, auto and healthcare sector to expand but energy may face challenge in 2025: Report

<ul class="summary-list"><li>Nevada is facing skyrocketing housing costs.</li><li>Reno Mayor Hillary Schieve says city leaders should cut regulations that stymie construction.</li></ul>The mayor of Reno, Nevada, argues that the single best thing city leaders can do to help solve one of the country's worst housing shortages is to loosen regulations on housing construction.In recent years, Mayor Hillary Schieve has launched a multi-pronged approach to do just that."Sometimes government needs to get out of the way," she told Business Insider in a recent interview. There's no quick solution, said Schieve, who isn't a member of either major party and has made housing and homelessness a top priority.With the election approaching, Nevada voters <a target="_blank" class="" href="https://www.nytimes.com/2024/09/16/business/economy/nevada-economy-unemployment-election.html">cite the economy</a> as among their top concerns. Rising home prices and rents, which have hit the Sunbelt state particularly hard, are a big part of that. Since January 2017, home prices have risen 90% and rents are up 53% in Nevada, far outstripping national growth rates, Alex Horowitz, the director of Pew's housing-policy project, told Business Insider.<h2 id="401ef500-7df2-405a-b9eb-f7ead571dd5b">Greasing the wheels for housing</h2>Nevada had one of the highest rates of home foreclosures in the country after the 2008 financial crisis slammed <a target="_blank" class="" href="https://knpr.org/show/knprs-state-of-nevada/2018-09-10/its-been-a-decade-since-nevada-fell-into-an-economic-abyss">its tourism-reliant economy</a> and burst its severe housing bubble. In the years since, the state has leveraged low taxes and other business-friendly policies to attract major employers like Amazon, Apple, and Tesla. The new jobs have helped attract hundreds of thousands of new residents.The pandemic and the rise of remote work supercharged that trend. With an <a target="_blank" class="" href="https://www.reviewjournal.com/business/housing/how-many-californians-have-moved-to-nevada-since-2020-3032074/">influx of new residents</a>, demand for housing — and subsequently its cost — has soared. In Reno, the median price of a single-family home has increased <a target="_blank" class="" href="https://www.washoecounty.gov/assessor/real_property/SalesHistoryChart.php">more than 40% since 2019</a>.As mayor, Schieve has celebrated the new jobs and the growth of arts and culture in Reno and its surroundings. But she's also concerned with the housing shortage and <a target="_blank" class="" href="https://www.rgj.com/story/news/local/2024/05/07/homeless-population-washoe-county/73605507007/">rising homelessness</a>. When it comes to boosting affordable housing, she pointed to cutting red tape and making building easier, including by loosening zoning laws and burdensome environmental regulations.Under Schieve, Reno has loosened some of its regulations by allowing for more density, reducing parking requirements, and cutting fees. Since 2019, the city says it has waived $11 million in sewer hookup fees and $700,00 in building permit fees to help bring more than 2,000 units of affordable housing to the market.Through a program called "1,000 homes in 120 days," the city deferred sewer and permit fees for five years for market-rate housing construction, which the city says helped create more than 500 new homes between its implementation in late 2019 and earlier this year.Schieve, the former chairwoman of the US Conference of Mayors, said Reno's rules regarding affordable housing construction are relatively lenient. However, she argued that some county and state regulations slow down home building, inflating costs and deterring new construction.She took particular issue with county health department regulations that impose lengthy review processes. "Most developers are borrowing money," she said. "So time is money." Schieve's chief of staff noted that swimming pool construction, including in housing developments and hotels, "takes an incredible amount of time and an incredible amount of money" to get approved by the department.Reno has also made some progress on emergency and transitional housing. Schieve received <a target="_blank" class="" href="https://www.wsj.com/us-news/reno-nevada-homelessness-solution-674cee2d">national attention</a> for reducing the number of unhoused people living on Reno's streets by nearly 60% between 2022 and 2023. The reduction was largely due to the construction of a Nevada Cares Campus, an emergency shelter that can house up to 600 people in sleeping pods and a large tent.<h2 id="b9ff010c-649b-4677-a22b-3b02162f6584">Nevada's housing issues take center stage in the presidential election</h2>President Joe Biden has visited Nevada multiple times <a target="_blank" class="" href="https://nevadacurrent.com/2024/03/19/in-las-vegas-campaign-stop-biden-details-plans-to-make-housing-more-affordable/">to talk about housing</a>, and his administration's policies have <a target="_blank" class="" href="https://mynews4.com/news/local/reno-receiving-35-million-in-federal-funds-to-tackle-affordable-housing-and-homelessness">helped bolster</a> the state's housing efforts.Schieve called the housing funding Reno received through the 2021 American Rescue Plan a "godsend." And she praised the Biden administration for being accessible and responsive to her city's housing needs. "We can pick up the phone and I can call my HUD secretary, I can call someone at the White House," Schieve said. The acting HUD secretary, Adrianne Todman, has visited Reno twice in the last year.Former President Donald Trump's campaign has also emphasized housing issues in Nevada, focusing largely on its proposal to deport millions of immigrants to free up housing. "We've got to build more houses and we've got to deport the illegal aliens so that American homes go to American citizens," vice presidential candidate JD Vance <a target="_blank" class="" href="https://www.youtube.com/watch?v=9pPCCh_t4h8">told a crowd in Las Vegas in October</a>.Schieve dismissed this proposal. "We've got to be realistic about how we approach housing," she said. "That's not going to solve anything."There are aspects of housing policy that Trump and Vice President Kamala Harris appear to agree on, including <a target="_blank" class="" href="https://www.businessinsider.com/homes-free-government-land-real-estate-housing-prices-harris-trump-2024-8">opening up federal land for additional homes</a>. Nevada has become a focus of this particular solution as 85% of the state's land area is owned by the federal government.Schieve says the issue of opening up government-owned land is complex. It depends on factors like the cost of new infrastructure, including roads and water hookups, the expansion of services like law enforcement, and environmental concerns. She supports restricting home construction in environmentally fragile areas, including wetlands and flood-prone regions.In general, she wants to see cities like Reno invest in rebuilding their urban cores and boosting density rather than sprawl."There's still a lot of blight," she said. "There's still a lot of work for cities to build up and not out."

A Nevada mayor is battling one of the worst housing shortages in the US. Her solution: looser construction regulation.

Indian financial services firm <keyword id="19913826" type="General" weightage="100" keywordseo="Zerodha" source="keywords" meta.keywordsubtype="org" meta.entityname="Zerodha" meta.hostid="261" meta.entityid="Zerodha">Zerodha</keyword> made headlines recently for hitting ₹8,320 crore revenue in FY24. However, its CEO and co-founder <keyword id="19923447" type="General" weightage="20" keywordseo="Nithin-Kamath" source="keywords">Nithin Kamath</keyword> says that the company is preparing for a decline in revenue as several regulatory changes are expected to take effect later this year. Kamath, in a blog post, outlined the challenges ahead, which could result in a <keyword id="20168027" type="General" weightage="20" keywordseo="revenue-drop" source="keywords">revenue drop</keyword> of up to 50% as Zerodha faces a combination of stricter regulations and shifting market conditions. <h2>Zerodha braces for revenue drop</h2>One of the main concerns for Zerodha is the new Securities and Exchange Board of India (SEBI) regulation, which will be implemented on October 1, 2024. Kamath expects a 10% dip in revenue as the "true-to-label" circular is enforced. This change will impose stricter guidelines on brokers like Zerodha regarding the kind of financial products they offer, potentially limiting some of their key revenue-generating activities. Another significant factor affecting Zerodha’s future revenue is the ongoing review of index derivatives regulations. Index derivatives, which are a crucial part of Zerodha's business model, could soon face changes that might severely impact the company’s earnings. Kamath estimates that such modifications could reduce earnings by 30-50%. Additionally, with the <keyword id="20930760" type="General" weightage="20" keywordseo="Securities-Transaction-Tax" source="keywords">Securities Transaction Tax</keyword> (STT) set to rise in October 2024, the costs of futures trading could further impact Zerodha’s profitability, though the effect on options trading may be limited. Zerodha is also set to face revenue pressures due to changes in Annual Maintenance Charges (AMC) under the new Basic Services Demat Account (BSDA) thresholds. From October 2024, brokers will only be able to charge full AMC fees from customers with holdings of ₹10 lakhs or more, up from ₹4 lakhs currently. Combined with Zerodha's removal of account opening fees, this is expected to significantly impact their revenue. Yet another challenge comes from Zerodha’s decision to halt payouts from its referral program. The program, which incentivised customers to refer others to the platform, will now only allow payouts to Authorised Persons (AP) registered with exchanges. This new regulation limits the number of people who can refer customers, slowing the firm's growth. <h2>Zerodha's financial results</h2>Despite these looming challenges, Zerodha posted strong financial results for the fiscal year 2024. The firm recorded a 62% increase in profits, reaching ₹4,700 crore, with revenue climbing by 21% to ₹8,320 crore. Traders using Zerodha's platform are also sitting on over ₹1 lakh crore in unrealised profits, largely driven by strong market performance and increased retail participation. However, Kamath also cautioned that the profitability boost in recent years has been fuelled by a bull market, which could reverse at any time. If the market turns, Zerodha, like many other financial service providers, may face significant challenges. To prepare for such an eventuality, the company has built up a strong financial position, with Kamath stating that their net worth now stands at nearly 40% of the customer funds they manage.

Zerodha co-founder Nithin Kamath says bracing for a huge revenue hit even as the company hits ₹8,320 crore revenue in FY24

In a significant move, the <keyword id="19899810" type="General" weightage="20" keywordseo="reserve-bank-of-india" source="keywords">Reserve Bank of India</keyword> (<keyword id="19899808" type="General" weightage="100" keywordseo="rbi" source="keywords">RBI</keyword>) has imposed penalties on <keyword id="19952948" type="General" weightage="20" keywordseo="axis-bank" source="keywords">Axis Bank</keyword> and <keyword id="19895995" type="General" weightage="20" keywordseo="hdfc-bank" source="keywords">HDFC Bank</keyword> for lapses in regulatory and statutory compliance. The fines, which amount to a total of ₹2.91 crore, highlight the central bank's ongoing efforts to ensure that financial institutions adhere to prescribed guidelines. The RBI levied a penalty of ₹1.91 crore on Axis Bank for violations that included contraventions of the <keyword id="19976511" type="General" weightage="20" keywordseo="banking-regulation-act" source="keywords">Banking Regulation Act</keyword> and non-compliance with specific RBI directions related to interest rates on deposits, Know Your Customer (KYC) norms, and collateral-free loans for agriculture. Meanwhile, HDFC Bank faced a ₹1 crore fine for failing to comply with directions concerning interest rates, customer service practices, and the use of recovery agents. <h2>Axis Bank: Key regulatory failures</h2>Axis Bank’s penalty stems from a supervisory evaluation conducted by the RBI based on its financial position as of March 31, 2023. Upon reviewing the bank’s activities, the RBI found several areas of non-compliance. One of the primary issues was the opening of savings deposit accounts in the names of ineligible entities, a direct violation of regulatory norms. Additionally, Axis Bank was found to have issued multiple customer identification codes to certain clients instead of assigning a Unique Customer Identification Code (UCIC), which is mandatory to avoid duplication and ensure proper monitoring of accounts. The bank also violated guidelines concerning agricultural loans. RBI regulations prohibit banks from asking for collateral for agricultural loans up to ₹1.60 lakh, but Axis Bank had obtained such collateral in certain cases. Lastly, a wholly-owned subsidiary of Axis Bank was found to be engaged in providing technology services—an activity that is not permissible for a banking company. This contravention added to the overall penalty levied by the central bank. <h2>HDFC Bank: Regulatory shortcomings</h2> In the case of HDFC Bank, the RBI’s investigation was based on its financial position as of March 31, 2022. The central bank uncovered several violations, including the offering of gifts, specifically covering the first-year premium for complimentary life insurance, which exceeded the permissible limit of ₹250. Moreover, HDFC Bank was found to have opened savings accounts in the names of ineligible entities, a violation similar to that of Axis Bank. Another significant failure was the bank’s inability to ensure that customers were not contacted by bank officials outside the permitted time frame of 7 am to 7 pm. <h2>RBI's Stance on Compliance</h2> While the RBI has been stringent in penalising both banks, it clarified that these penalties are based on lapses in regulatory compliance and are not reflective of the validity of any transactions or agreements between the banks and their customers. The central bank’s message is clear—financial institutions must adhere strictly to guidelines to maintain transparency, protect customers, and uphold the integrity of the banking system. The penalties serve as a reminder to all banks to stay vigilant and maintain high standards of compliance to avoid such financial and reputational damage in the future. Both Axis Bank and HDFC Bank have accepted the fines and are expected to take corrective actions to avoid future infractions. For customers, this action from the RBI is a reassurance that regulatory oversight remains a priority to ensure fair banking practices across the country.

RBI slaps fine of Rs 2.91 crore on Axis Bank and HDFC Bank: All details

The <keyword id="20018890" type="General" weightage="20" keywordseo="digital-infrastructure" source="keywords">digital infrastructure</keyword> has made the <keyword id="20572901" type="General" weightage="20" keywordseo="loan-sanctioning" source="keywords">loan sanctioning</keyword> system adopt an online mode, but the <keyword id="21614839" type="General" weightage="20" keywordseo="loan-recovery" source="keywords">loan recovery</keyword> still requires a 'feet on the street' approach, says <keyword id="20506781" type="General" weightage="20" keywordseo="swaminathan-j" source="keywords">Swaminathan J</keyword>, Deputy Governor of Reserve Bank of India (RBI). Speaking at a media event in Mumbai, the deputy Governor of RBI noted that with the digital infrastructure at place, many <keyword id="22721545" type="General" weightage="20" keywordseo="fintech-players" source="keywords">fintech players</keyword> are giving loans to customers with poor credit profiles, and up on default, use aggressive recovery tactics. "While loan sanctioning and disbursement have become increasingly digital, effective collection and recovery still require a 'feet on the street' and empathetic approach. Many fintech platforms operate on a business model that involves extending <keyword id="22791879" type="General" weightage="20" keywordseo="small-value-loans" source="keywords">small-value loans</keyword> to customers who often have a poor credit profiles" said the deputy governor. He emphasized that the business model of many fintech platforms involves offering small-value loans to customers who often have poor credit profiles. This has led to the adoption of aggressive recovery strategies, which on many occasions also crosses ethical boundaries. He also highlighted one particularly concerning practice that involves the invasion of customers' privacy, where recovery agents access the personal data and contacts of borrowers and use that as a threat practice. Swaminathan cautioned that such tactics not only infringe on individuals right to privacy, but also risk damaging the reputation of regulated lenders associated with these fintech platforms. He also highlighted RBI's regulations on outsourcing, that even though regulated financial entities delegate certain activities to third parties, they remain ultimately accountable for the actions of their outsourced agents. The deputy governor also noted that the digitisation allows banks and NBFCs to leverage data for greater insights into their customers' requirements and behaviour, which can be used for developing bespoke products apart from facilitating better risk management and compliance. He stated that the role of RBI as a regulator is to establish guardrails or a balanced framework that encourages innovation while ensuring that risks are managed prudently. The deputy governor also indicated the primary goal of RBI is to ensure the stability and integrity of the financial system and not to hinder business operations.

Loan sanctioning has gone digital, but recovery still needs a 'feet on the street' approach, says RBI Deputy Governor

Counted as it is among the world’s fastest growing economies, an unfathomable amount of money flows in and out of the Indian economic system. But there are cracks in said system, and ever so often, a fraudulent mastermind uses them to slip some cash out for their advantage. From <keyword id="19964851" type="General" weightage="20" keywordseo="ponzi" source="keywords">Ponzi</keyword> schemes to bank frauds, the Indian government and investors have fallen victim to many financial scandals — some of which were so sordid that they can be recounted like they happened yesterday. Here’s a rundown of the most infamous scams in Indian financial history: <h2><keyword id="20713434" type="General" weightage="20" keywordseo="harshad-mehta" source="keywords">Harshad Mehta</keyword> Scam (1992) – ₹4,000 Crore </h2>Perhaps the most iconic of all Indian financial scams, Harshad Mehta was known as the "Big Bull" of the stock market. He manipulated stock prices using illegal loopholes in the banking system. By obtaining unsecured loans from banks and investing them in the stock market, Mehta artificially inflated stock prices. His bubble burst when banks demanded their money back, revealing the massive fraud. This scandal led to a major reform in India's financial markets. Mehta died in jail before full legal accountability was reached, but the scam caused a significant loss to investors and led to tighter regulation in the Indian stock market. <h2><keyword id="23122396" type="General" weightage="20" keywordseo="satyam-scam" source="keywords">Satyam Scam</keyword> (2009) – ₹14,000 Crore </h2>Dubbed as India’s Enron, the Satyam scandal involved its founder, <keyword id="23122397" type="General" weightage="20" keywordseo="ramalinga-raju" source="keywords">Ramalinga Raju</keyword>, admitting to falsifying the company's accounts to the tune of ₹14,000 crore. Satyam Computer Services, once considered a blue-chip company, was found guilty of inflating profits and revenues. Raju admitted to the scam after a failed attempt to buy two Maytas firms owned by his family. This case brought corporate governance issues in India to the forefront. Raju was convicted, but the legal processes have allowed him temporary freedom through bail. But this incident called for improved transparency and stricter corporate governance norms. <h2>Punjab National Bank Scam (2018) – ₹13,700 Crore </h2>Diamond merchant Nirav Modi and his uncle Mehul Choksi orchestrated one of the largest frauds in Indian banking history by obtaining fraudulent Letters of Undertaking (LoUs) from Punjab National Bank (PNB). These LoUs allowed them to obtain loans from foreign branches of Indian banks without providing any collateral. The scam involved over ₹13,700 crore, and Modi fled the country, causing significant reputational damage to India’s banking sector. Nirav Modi’s extradition is still pending, and Mehul Choksi remains out of India’s legal jurisdiction. The scam, however, resulted in strengthened banking regulations regarding LoUs and SWIFT transactions. <h2><keyword id="23122399" type="General" weightage="20" keywordseo="vijay-mallya-scam" source="keywords">Vijay Mallya Scam</keyword> (2016) – ₹9,000 Crore</h2>The "King of Good Times" was living large while his airline, Kingfisher, was drowning in debt. Vijay Mallya allegedly defaulted on loans amounting to ₹9,000 crore from various banks. He fled to the UK in 2016, leaving creditors, employees, and stakeholders in financial distress. His lavish lifestyle amidst the collapse of his airline made this scandal a high-profile case. Mallya’s extradition process is ongoing, but he remains out of reach of Indian authorities. The main impact was enhanced scrutiny of loan defaults and triggered legal reforms on extradition. <h2>Saradha Chit Fund Scam (2013) – ₹2,500 Crore </h2>The Saradha Group, operating a ponzi scheme disguised as a chit fund, promised unrealistically high returns to its investors, mostly in West Bengal and Odisha. The scam collapsed, leaving over 1.7 million people, many of whom were low-income investors, without their life savings. Politicians and celebrities were also implicated in the case. While Sudipta Sen is behind bars, not all the accomplices have been held accountable. But this Ponzi scheme resulted in reform of chit funds and greater regulatory oversight on such investment schemes. <div type="Article" hostid="261" msid="112337071" title="Noida woman invests in stock market via an app, loses over Rs 69 lakh as it turns out to be a scam" mstype="2" mssubtype="0"></div> <h2><keyword id="6560832" type="General" weightage="20" keywordseo="2g-spectrum-scam" source="Orion">2G Spectrum Scam</keyword> (2008) – ₹1,76,000 Crore </h2>The 2G spectrum allocation scandal involved the underpricing of telecom licences to select companies in exchange for bribes. Telecom minister A. Raja was at the centre of this controversy, which allegedly caused a loss of ₹1.76 lakh crore to the exchequer. The case was seen as a massive blow to public trust in India’s telecom sector and led to significant political fallout. Sadly, all key figures involved were acquitted despite the Supreme Court’s intervention and cancellation of 122 telecom licences. <h2><keyword id="455134" type="General" weightage="20" keywordseo="coal-allocation-scam" source="Orion">Coal Allocation Scam</keyword> (Coalgate) (2012) – ₹1,86,000 Crore </h2>The coal allocation scam, or "Coalgate," involved the illegal allocation of coal blocks to private companies between 2004 and 2009. The CAG of India estimated a loss of ₹1.86 lakh crore to the exchequer due to non-competitive bidding. Many high-profile politicians and industrialists were implicated, making this one of the largest political scandals in India. While some officials faced legal consequences, many key players were not prosecuted. But it did trigger policy reforms in the allocation of natural resources. <h2>DHFL Scam (2019) – ₹34,615 Crore </h2>Dewan Housing Finance Corporation Limited (DHFL) was accused of syphoning off over ₹34,000 crore through a series of shell companies and fraudulent loans. Investigations revealed that the promoters used these funds for personal enrichment and illegal political donations. The case came to light after an investigation by investigative journalists and was later confirmed by a report from KPMG. The case is ongoing, and the main accused are in custody. For now, regulations governing non-banking financial companies (NBFCs) have been strengthened. <h2>Yes Bank Crisis (2020) – ₹3,788 Crore </h2>Yes Bank, under its founder <keyword id="19899935" type="General" weightage="20" keywordseo="rana-kapoor" source="keywords">Rana Kapoor</keyword>, was involved in questionable lending practices. The bank made high-risk loans to companies already in financial trouble, which eventually turned into non-performing assets (NPAs). Kapoor was arrested, and the Reserve Bank of India had to step in to stabilise the bank. The case highlighted serious lapses in corporate governance and risk management. As of now, Rana Kapoor is facing trial, and legal proceedings are active. The RBI has also introduced new measures to monitor the health of banks more rigorously. <h2>Commonwealth Games Scam (2010) – ₹70,000 Crore </h2>The 2010 Commonwealth Games held in New Delhi were overshadowed by corruption allegations involving inflated contracts and kickbacks. <keyword id="23122398" type="General" weightage="20" keywordseo="suresh-kalmadi" source="keywords">Suresh Kalmadi</keyword>, the head of the organising committee, was arrested for awarding contracts at exorbitant rates. The estimated loss to the exchequer was around ₹70,000 crore. This scam tarnished India’s image on the global stage. Kalmadi was arrested but the case has not resulted in major convictions or recoveries, except for stricter oversight on large public projects and international event planning. These scams not only caused financial damage but also eroded public trust in India’s institutions. In response, India has tightened regulatory frameworks, improved corporate governance, and adopted stricter banking standards, although challenges persist in tackling large-scale fraud. <div type="Article" hostid="261" msid="112896255" title="I was scammed out of $300K in a 3-month-long government impersonation scam" mstype="2" mssubtype="0"></div>

10 financial scams that shook India: A dive into deception

<ul class="summary-list"><li>Biden made commitments during the campaign that impacted key economic appointments.</li><li>Should Harris become president, she'll have much more freedom, and industry leaders have high hopes.</li></ul>When President Joe Biden stepped into the White House in January 2021, he was hamstrung not only by the pandemic but also by a promise he'd made to a former challenger: Sen. Elizabeth Warren of Massachusetts. When slogging through the political thicket of a crowded Democratic primary, Biden had assured Warren that she would have significant sway over economic regulatory agency appointments.Warren's desired appointees — namely <a target="_blank" href="https://www.businessinsider.com/harris-lina-khan-balance-billionaires-silicon-valley-hoffman-progressives-ftc-2024-8">Lina Khan </a>and Gary Gensler, chairs of the Federal Trade Commission and Securities and Exchange Commission respectively — have drawn the praise of many economic progressives and ire of many business leaders. But now that Vice President Kamala Harris is running for president in Biden's place after he dropped out, Khan and Gensler's future as chief regulators is in doubt.<h2 id="6ff1d1bc-fa5b-4d13-adfa-aa52b4d8b1ee">Biden made a key commitment to Warren when he was running for president</h2>"One of [Warren's] preferences was, 'I want Lina Khan to run the FTC,'" William Kovacic, former FTC chair and current law professor at George Washington University, previously told Business Insider. "Biden fulfilled that promise. But that was Biden's promise. That's not Harris' promise."Adam Kovacevich, a Democratic lobbyist and the CEO of progressive tech industry coalition Chamber of Progress, doesn't think that Biden was particularly interested in regulatory economic issues."I think giving some picks to people like Elizabeth Warren kept Warren off his back on other issues," Kovacevich said. "Flash forward to today: Kamala Harris doesn't owe Elizabeth Warren anything."During the 2020 cycle, various media outlets reported that Warren is <a target="_blank" href="https://www.motherjones.com/politics/2020/07/joe-biden-is-promising-progressive-policies-whos-going-to-hold-him-to-it/">singularly attuned</a> to the power of economic regulatory agencies. A former Democratic aide told <a target="_blank" href="https://www.politico.com/news/2021/03/15/elizabeth-warren-aides-biden-administration-475653">Politico</a> that "Warren will be the most influential voice in the financial policy debate under the new administration," and the president of the Consumers Bank Association said that she "virtually hand-picked the financial and other regulatory nominations she cares deeply about."But business and tech leaders who winced at the current appointments <a target="_blank" href="https://www.businessinsider.com/harris-trump-debate-silicon-valley-crypto-regulation-ai-taxes-2024-9">see an opportunity in Harris</a>. With <a target="_blank" href="https://www.businessinsider.com/kamala-harris-biden-california-democrats-silicon-valley-tech-hollywood-2024-7">deep ties to California</a>, Harris is presenting herself as a pro-business candidate who understands the tech industry far better than her current boss. And she's garnering support among industry executives across the country — <a target="_blank" href="https://www.businessinsider.com/silicon-valley-billionaires-investors-kamala-harris-mark-cuban-reid-hoffman-2024-8">a group of powerful venture capitalists</a> have vowed to vote for her and nearly <a target="_blank" href="https://www.businessinsider.com/murdoch-cuban-corporate-executives-silicon-valley-wall-street-endorse-harris-2024-9">100 corporate leaders</a> recently endorsed her in a joint letter.Her supporters in the upper echelons of business and tech are particularly focused on appointments, with many saying that leaders should effectively balance regulation with innovation. In particular, they want appointees that institute clear crypto guidelines and veer away from the current regulatory approach that Warren had championed.Yet <a target="_blank" class="" href="https://www.businessinsider.com/aaron-levie-quit-college-to-found-box-now-25-billion-company-2017-7">Aaron Levie</a>, CEO of Box, said that there isn't consensus in the tech world about anti-trust doctrine, as big and small companies have different priorities. There are many individuals in the Biden administration, such as Arati Prabhakar of the Office of Science and Technology Policy, who are thoughtful tech leaders but aren't widely discussed, he said.<h2 id="3cd1d3b1-d6c5-43d4-abd7-f708eff23c63">Harris could chart a different path</h2>Still, founders and business executives seem, on the whole, dissatisfied. Democratic donors on Wall Street are quietly encouraging Harris to oust Khan and Gensler, <a target="_blank" href="https://www.bloomberg.com/news/articles/2024-09-06/kamala-harris-donors-privately-want-ftc-s-lina-khan-sec-s-gary-gensler-removed">Bloomberg reported</a>.Chris Larsen, the billionaire founder of blockchain payments company Ripple who is among the execs to endorse Harris, told Business Insider he wants her to make different appointments if she wins.Larsen said he wants regulators that are "not pre-selected by the Warren camp and can balance both consumer protection with ensuring our national champions dominate their industries."Christian Catalini, the founder of the MIT Cryptoeconomics Lab, said that Gensler demonstrated "reluctance to engage in constructive dialogue with startups seeking regulatory clarity." He thinks that tech entrepreneurs are particularly hung up on who Harris would choose for the SEC.Recently, billionaire investor and owner of the Dallas Mavericks <a target="_blank" href="https://www.businessinsider.com/mark-cuban-kamala-harris-sec-capital-gains-business-2024-9">Mark Cuban offered himself up for a spot at the SEC</a>. Cuban is in close communication with the Harris team and said that she will likely surround herself with more individuals from the private sector than Biden.Levie also said that engaging with the private sector is "absolutely critical" and hopes Harris invites more industry actors to join the margins of her administration."The way that they have already been interacting with business leaders is a compelling indication of where things could go in the future," Levie told Business Insider.However, the vice president has been relatively quiet about her views on antitrust enforcement and who she would appoint. Khan's tenure as chair of the FTC is up in September and she is open to staying on in her position. Gensler's term lasts until June, 2026; in February, he said he would "<a target="_blank" class="" href="https://subscriber.politicopro.com/article/2024/02/gensler-absolutely-plan-to-stay-on-at-sec-in-second-biden-term-00140134">absolutely" stay on if Biden</a>, who was then still the nominee, won a second term.Kovacic previously told Business Insider that Harris' relationship to economic progressives like Warren remains unclear."A factor to be assessed is, what is the nature of her relationship with this wing of the Democratic Party? How much loyalty does she feel to them? How much does she believe that she has to cater to their tastes in order to maintain a harmonious political relationship? But she has a bit more freedom than Biden did," he said.Kovacevich, who calls himself a "pro-business and pro-Harris democrat," doesn't think that Harris needs to win over Warren voters. He suspects that the Vice President will "reset" the current environment and return to the Obama era, which was friendlier to corporations."I do think it's notable that she has not prioritized attacks on corporate power in her campaign rhetoric. I think she correctly sees how that's not a motivator to most voters," he said.<h2 id="196f9aac-f8fe-4c23-9b6c-70c49aa3137f">The Vice President's precise plans remain unclear with only 50 days until the election.</h2>The relationship between Harris and Warren's philosophical counterparts has been testy at times. In March of last year, Warren gave a lukewarm answer when a radio host asked whether Biden should <a target="_blank" href="https://www.businessinsider.com/warren-called-harris-twice-apologize-comments-hasnt-called-back-2023-3">keep Harris on as his vice president</a>."I really want to defer to what makes Biden comfortable on his team," she said at the time. The senator quickly issued a statement saying that she supports the Biden-Harris 2024 ticket. She reportedly called Harris twice after the incident — without receiving a call back.Kovacic suspects that economic progressives don't entirely trust Harris, given her ties to the business world."It's not as though they think she will simply be an agent of Big Tech," he previously told Business Insider. "It's a concern that she is too sympathetic to their interests, that she will not be as aggressive." He anticipates that Harris will move to the center on mergers, but maintain the Biden administration's approach to monopolization and price-gouging.A spokesperson for the SEC declined to comment, and representatives for Harris and Warren did not respond to Business Insider's request. Douglas Farrar, a spokesperson for the FTC, emphasized Khan's efforts to lower costs and said that "there is a lot of work yet to do to bring the benefits of fair competition to American consumers and entrepreneurs."Should Harris win the election, the question of appointments will loom large. The leadership plays a major role in determining how successful American industries and companies are, Levie said."In the next four years, we'll be dealing with major policy subjects that relate to the next many decades of innovation," he told Business Insider. "And you want very smart, thoughtful, highly competent, experienced people in a stable environment that can help define where we're going to go with AI, with new energy sources, with advanced manufacturing, biotech."Unhampered by campaign promises yet caught between opposing factions of her party, Harris may usher in a new regulatory era. But since regulatory appointments don't make a <a target="_blank" class="" href="https://www.businessinsider.com/trump-harris-economy-tech-debate-tariffs-taxes-2024-9">good political sound bite,</a> it's likely we won't know her plans unless she wins in November.

Harris can chart her own path with the top regulators — and Big Business hopes she's on their side

<ul class="summary-list"><li>Investment firms want to offer private-credit ETFs to ordinary investors, the WSJ reported. </li><li>It would give retail investors access to a $1.7 trillion market. </li></ul>A booming corner of the financial markets that has only been available to institutions might soon be open to everyday investors. <a target="_blank" class="" href="https://www.wsj.com/finance/investing/wall-street-races-to-bring-private-credit-to-the-masses-8a25b624?mod=finance_lead_story">According to The Wall Street Journal,</a> some of the biggest private equity and investment management giants want to offer retail investors access to exchange-traded funds backed by private credit. The term broadly refers to loans made to companies and consumers by nonbank lenders. Historically, fund managers have sold "alternative assets" like private debt to institutional investors at a high cost, generating returns of around 10% in recent years — more than they would have seen from investing in the stock or bond markets.Now, as those institutions slow allocations to private credit, the biggest players in the space want to target a new class of investors. According to the Journal, firms like State Street, Apollo Global Management, and BlackRock are working to roll out private credit ETFs to regular investors. The challenge, though, is building a highly liquid ETF out of illiquid private loans. That hurdle is also what will likely draw the eye of regulators as they ensure the ETFs are appropriate for retail investors. But if these ETFs get approved, they will enable regular investors to tap into a booming market, one that BlackRock expects will more than double to $3.5 trillion by 2028. The race to launch private credit ETFs has heated up in recent months.In May, Capital Group and KKR teamed up to start offering funds investing in both public and private assets—including in private credit—starting next year.Last month, State Street proposed a private debt ETF to the Securities and Exchange Commission. The ETF would blend public debt with private debt on mortgage, corporate, and consumer loans purchased from Apollo Global Management. Anna Paglia, State Street's chief business officer, <a target="_blank" class="" href="https://investors.statestreet.com/investor-news-events/press-releases/news-details/2024/State-Street-Global-Advisors-and-Apollo-Global-Management-Join-Forces-to-Increase-and-Broaden-Investor-Access-to-Private-Markets/default.aspx">said in a statement</a> the ETF would "democratize access to private asset exposures," and make them "more accessible to a wider swathe of investors.""It is our goal to bring these investments to scale and help facilitate the process of making private assets more accessible and liquid over time. We see this as only the beginning of a new wave of innovation as public and private markets increasingly converge," Paglia said. Alternative assets make up a small share—less than 3%—of individual investors' global investments, KKR's head of Global Client Solutions Eric Mogelof, told the <a target="_blank" href="https://www.wsj.com/finance/investing/wall-street-races-to-bring-private-credit-to-the-masses-8a25b624">Wall Street Journal</a>.But he says there is huge potential for that share to grow by over three times. "We anticipate these allocations to rise to 10% or greater in the future," he told the Journal.

Investing giants want to offer retail traders access to a booming sector of financial markets

Stock <keyword id="20345915" type="General" weightage="20" keywordseo="exchanges" source="keywords">exchanges</keyword> and <keyword id="20710434" type="General" weightage="20" keywordseo="brokers" source="keywords">brokers</keyword>, catering to retail traders, could be hit hard by the regulator <keyword id="19901201" type="General" weightage="100" keywordseo="Sebi" source="keywords">SEBI</keyword>'s proposed measures for Futures &amp; Options (F&amp;O) <keyword id="22748189" type="General" weightage="20" keywordseo="trading-regulations" source="keywords">trading regulations</keyword>, with market volumes slumping 30-40 %, according to reports. If these measures are implemented, the number of investors could decrease, it added. Moreover, discount brokers, who depend heavily on retail investors, are expected to be more affected than traditional full-service brokers. SEBI, in its consultation paper in July, proposed seven measures, including increasing minimum contract size and upfront collection of option premiums, intra-day monitoring of position limits, rationalisation of strike prices, removal of calendar spread benefit on expiry day and increase in near contract expiry margin. SEBI stated that these measures are aimed at enhancing <keyword id="20775670" type="General" weightage="20" keywordseo="investor-protection" source="keywords">investor protection</keyword> and promoting <keyword id="20813757" type="General" weightage="20" keywordseo="market-stability" source="keywords">market stability</keyword> in derivative markets. According to a report by Jefferies, SEBI's proposed measures to reduce the number of weekly option contracts from 18 to 6 could impact around 35% of industry premiums. However, if trading shifts to the remaining contracts, the overall impact can be reduced to 20-25%. Among its 7 proposed measures, IIFL Securities see the highest impact from the withdrawal of <keyword id="22353333" type="General" weightage="20" keywordseo="weekly-options" source="keywords">weekly options</keyword> (only 1 per exchange allowed) as index Options account for 98% of the volumes. IIFL Securities expects the National Stock Exchange (NSE) to be more affected than the BSE because 60 % of NSE's revenue comes from options trading, compared to 40% for BSE. It estimates that by the financial year 2026, NSE's earnings could be reduced by 25-30% while BSE's earnings could drop by 15-18%. Jefferies also believes that the removal of Bankex weekly contract can impact BSE's earnings per share (EPS) by 7-9% over FY25-27. It further said that BSE might see a small decline in earnings, but if trading activity shifts from discontinued products, it could offset the impact or even lead to earnings growth. "We don't see any impact on MCX from these regulations. Within the value chain, discount brokers are likely to be more impacted than traditional full-service brokers given the former's dependence on retail investors," IIFL Securities said. Jefferies believes that clearing members like Nuvama, which caters to institutional players High-Frequency Traders (HFTs), and Foreign Portfolio Investors (FPIs) are less impacted. Rationalizing weekly options to only one benchmark index per exchange will significantly affect the NSE because it currently has four weekly index expiries, with "Bank Nifty" being the most important, contributing to 50 % of its options volume. The change could reduce NSE's overall trading volumes by 30-35 %, IIFL Securities said. On the other hand, BSE is expected to be less affected since it only has two contracts, with Sensex making up 85 % of its volumes in FY24. Even if "Bankex" contributes 30% by FY26, the impact on BSE's volumes is expected to be smaller compared to NSE, it said. Additionally, with just two expiries, BSE might gain market share and experience higher trading volumes, resulting in an estimated 20 % reduction in its overall volumes, it added. Jefferies said that SEBI's proposed measure of increasing lot sizes by 3-4 times over six months could lead to higher costs for retail traders, potentially reducing their participation in the market. The proposed margin increase for options sellers close to expiry could reduce leverage and profitability, especially for retail traders with limited funds. "Finally other measures like increasing ELM (extreme loss margin) around expiry, and withdrawal of calendar spread margin on expiry will increase the margin requirements and thereby could impact the liquidity. Based on our initial estimates we expect a 30-40 % impact on market volume," IIFL Securities said. SEBI Chief Madhabi Puri Buch recently mentioned that households are losing up to Rs 60,000 crore a year in the problematic futures and options segment. Earlier, SEBI research showed retail traders lose money in nine out of 10 trades in the F&amp;O segment Last month, the government in the Union Budget raised the securities transaction tax (STT) on both futures and options trade from October 1 to allay concerns about hyperactive interest in the derivative segment. Before that, the Economic Survey flagged concerns over rising retail investors' interest in derivative trading. The survey stated that speculative trade has no place in a developing country. It also pointed out that the sharp increase in retail investor participation in F&amp;O trading is likely driven by humans' gambling instincts.

You Searched For "financial regulators" and got 12 results

Removed Angel Tax, taking policy measures to promote fintech sector: PM Modi

PTI

SEC is unhappy that Elon Musk did not give testimony to the financial regulator to attend a SpaceX launch

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Why does the US want Google to sell its Chrome browser?

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A Nevada mayor is battling one of the worst housing shortages in the US. Her solution: looser construction regulation.

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RBI slaps fine of Rs 2.91 crore on Axis Bank and HDFC Bank: All details

BI India Bureau

Loan sanctioning has gone digital, but recovery still needs a 'feet on the street' approach, says RBI Deputy Governor

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10 financial scams that shook India: A dive into deception

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Harris can chart her own path with the top regulators — and Big Business hopes she's on their side

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SEBI proposed F&O norms to hit exchanges, brokers, says reports

PTI

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