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Reliance
to get into credit card biz
Mumbai: The Reliance Anil Dhirubhai Ambani Group
(ADAG) has tied up with Citibank to launch a credit card
in association with Visa International. The cards will
be available in two categories - silver and gold. Initially,
they will be available in Mumbai and Delhi, followed by
other metros such as Hyderabad, Chennai, Kolkata, Pune
and Bangalore and thereafter in all other cities and towns
nationwide.
The
cards will be have the usual benefits that are available
with other cards such as free for lifetime and reward
points as part of the loyalty program. Points earned can
be redeemed across various Reliance ADAG products and
services such as recharge of prepaid mobile connections,
payment of mobile bills, electricity bills, life and general
insurance premia and availing services across Reliance
World and Reliance Communications retail outlets as well
as Adlabs multiplexes. They will offer complimentary vouchers
on joining, cash advance facility, free utility bill payment
facilities, hospital allowance, free towing of vehicles
and zero fuel recharge at IndianOil petrol pumps.
One
of the unique features include addition of five add-on
cards at no additional charges, free email statements,
free alerts and the compatibility to transfer money from
one Visa card to another using Citibank online.
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Reserve
Bank may ease SEZ lending norms
Mumbai: The Reserve Bank of India (RBI) is likely
to review its decision to club lending to special economic
zones (SEZs) with commercial real estate after the government
comes out with a revised policy.
RBI
indicated this at recent meetings with bankers, who had
sought clarifications on how should they treat lending
to genuine infrastructure projects in SEZs, banking sources
said.
The
RBI is likely to prescribe a graded structure of risk
weights for bank finance to SEZs. It may lower the risk
weights for lending to infrastructure projects in SEZs
to 75 or 100 per cent from 150 per cent applicable for
commercial real estate exposures.
Recently,
the RBI decided that the exposure of banks to entities
setting up special economic zones or for acquisition of
units in SEZs would be treated as exposure to commercial
real estate sector. This entails 150 per cent risk weight
for such loans.
A
100 per cent risk weight means banks have to allocate
capital of Rs9 for every Rs 100 lent and a risk weight
of 150 per cent would translate into capital allocation
of Rs13.5 for every Rs100 lent.
The
RBI has hiked the risk weights on exposure to sensitive
sectors to 150 per cent from 100 per cent in the last
couple of monetary policy reviews. These included exposure
to capital market, home loans above Rs20 lakh and commercial
real estate.
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ICICI,
Grameen seek NBFC status
Mumbai: ICICI Bank, which has been the most innovative
player in the microfinance segment, has joined hands with
the Grameen Foundation USA and ITCOT Consulting to set
up Grameen Capital India (GCI).
The
bank has already moved the Reserve Bank of India (RBI)
seeking a licence for the non-banking finance company
(NBFC).
While
Grameen Foundation will hold 50.5 per cent equity in GCI,
ICICI Bank and ITCOT will have 19 per cent and 30.5 per
cent, respectively, in the company. GCI, to be registered
as an NBFC with the RBI, will provide financial and advisory
assistance to microfinance institutions (MFIs) in the
country.
The
current foreign direct investment policy allows up to
100 per cent foreign investment in NBFCs. Grameen Foundation's
50.5 per cent stake in GCI will subject it to the minimum
capitalisation norm of $0.5 million, to be brought in
upfront.
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IRDA
nod may be required for new LIC branches
Kolkata: Life Insurance Corporation (LIC) may
need to take permission from the Insurance Regulatory
and Development Authority (IRDA) to set up new branches
and satellite offices. The LIC Act, in its present form,
does not require LIC to seek IRDA approval to open branches
and offices. But if IRDA has its way and the government
amends the LIC Act of 1956, the insurance major will have
to take the regulator's permission in this regard.
In
a bid to expand its presence in rural India, LIC has initiated
the process of opening satellite offices for which IRDA
approval may be necessary. At present, LIC has 2,048 branches,
100 divisional and seven zonal offices.
IRDA
has also directed private insurers to open new branches
within a year of receiving approval, failing which they
will need to apply afresh. Earlier, there was no time-limit
to start expansion plans.
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SBI
reduces bulk deposit rates by 25bps
Mumbai: The State Bank of India (SBI) has cut interest
rate offered on bulk deposit by 25 basis points. This
comes amid expectations that there could be one more round
of rate hike after the central bank announces the credit
policy on October 31.
Till
last week, SBI was offering 8 per cent on bulk deposits
which has now been officially revised to 7.75 per cent.
No other bank has altered its interest rates in the past
weeks. SBI probably has taken into account some softening
of liquidity in the system.
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ADB
to loan $100mn to India
New Delhi: Asian Development Bank (ADB) will extend
India a $100 million-loan to strengthen the commodity
derivatives markets, a senior government official said.
The bank will also give a $4 million grant to upgrade
infrastructure facilities at commodity exchanges and the
Forward Markets Commission which regulates commodity markets.
India allowed trading in commodity futures in 2002. Three
exchanges — the National Commodity and Derivatives
Exchange, Multi Commodity Exchange, and National Multi
Commodity Exchange — were set up in 2003. Official
sources said the ADB loan would also be used to strengthen
the regulatory framework and set up a training institute
to develop human resources and skills.
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