SFM Nirmala Sitharaman had said business establishments with annual turnover of more than 50 crore should offer low cost digital modes of payment to their customers and the RBI and banks should absorb cost of transactions.
The government on Friday said banks or system providers will not impose charges or Merchant Discount Rate on customers as well as merchants on digital payments made to establishments having turnover in excess of Rs 50 crore from November 1
In her Budget speech, Finance Minister Nirmala Sitharaman had said business establishments with annual turnover of more than 50 crore should offer low cost digital modes of payment to their customers and the RBI and banks should absorb cost of transactions.
Following the announcement, amendments have been made in the income tax act as well as in the Payment and Settlement Systems Act 2007.
The new provisions “shall come into force with effect from November 1, 2019,” the Central Board of Direct Taxes (CBDT) said in a circular. The CBDT has also invited applications from banks and payment system providers who are willing that their payment systems may be used for the purpose as the government plans to prescribe certain electronic modes of payment.
DHFL exposure: RBI rejects banks’ ‘Trust’ proposal
RBI declines the proposal by banks to grant relief from provisioning for the troubled mortgage lender.
The Reserve Bank of India (RBI) rejected a proposal by banks that would have allowed them provisioning relief to the tune of Rs 6,000 crore on borrowings by troubled mortgage lender Dewan Housing Finance Corp.Ltd (DHFLNSE 4.89 %), said two people aware of the development. This could dent the December quarter earnings of Indian banks.
Banks have a total exposure of Rs 40,000 crore to DHFL and will be required to make 15% provisioning on the account by the end of the December quarter.
The lenders had proposed the creation of a trust that would hold 51% of the company following the conversion of some part of debt to equity. This could then be classified as an “ownership change,” said one of the people cited above. Under a clause in the regulator’s June 7 circular on the stressed asset resolution framework, additional provisions on an account can be reversed if ownership changes.
The RBI said that equity holding through a trust cannot be considered a change in ownership as the loans are sitting on the banks’ books,” said a person aware of the development.
Indian Banks Association elects Rajnish Kumar as chairman
SBI’s head Rajnish Kumar has been elected as the chairman of Indian Banks Association for fiscal 2019-20. UBI’s G Rajkiran Rai, S S Mallikarjuna Rao of PNB and Madhav Kalyan JP Morgan Chase Bank have been appointed deputy chairmen.
SBI’s head Rajnish Kumar has been elected as the chairman of the banking industry lobby Indian Banks Association for fiscal 2019-20.
The body, which represents banks’ interests with the government and regulators, said it has three top bankers from various lenders as its deputy chairmen.
An official statement said these include Union Bank of IndiaNSE -0.19 %’s G Rajkiran Rai, S S Mallikarjuna Rao of Punjab National BankNSE 2.03 % and Madhav Kalyan JP Morgan Chase Bank.
IDBI Bank’s managing director and chief Rakesh Sha ..
GST collection jumps to Rs 1.13 lakh crore in April, the highest since its rollout
collections in April jumped to its highest level of Rs 1,13,865 crore since its roll out in 2017. While collections have been gradually increasing since August, they hit a record high last month of Rs 1.06 lakh crore, up from Rs 97,247 crore in the previous month, on the back of high compliance and increased number of returns.
The total gross collected in the month of April, 2019, is Rs 1,13,865 crore of which CGST is Rs 21,163 crore, SGST is Rs 28,801 crore, IGST is Rs 54,733 crore, the ministry of finance said in a statement.
The ministry said the total number of GSTR 3B Returns filed for the month of March up to 30th April, 2019 is 72.13 lakh. The Centre has settled Rs 20,370 crore to CGST and Rs 15,975 crore to SGST from IGST as regular settlement. Rs 12,000 crore has been settled from the balance IGST available with the Centre on provisional basis in the ratio of 50:50 between Centre and the States.
Extradition law: Hong Kong tycoons start moving assets offshore
Extradition law: Hong Kong tycoons start moving assets offshore
Hong Kong: Some Hong Kong tycoons have started moving personal wealth offshore as concern deepens over a local government plan to allow extraditions of suspects to face trial in China for the first time, according to financial advisers, bankers and lawyers familiar with such transactions.
One tycoon, who considers himself potentially politically exposed, has started shifting more than $100 million from a local Citybank account to a Citibank account in Singapore, according to an adviser involved in the transactions. “It’s started. We’re hearing others are doing it, too, but no one is going to go on parade that they are leaving,” the adviser said. “The fear is that the bar is coming right down on Beijing’s ability to get your assets in Hong Kong. Singapore is the favoured destination.”
Hong Kong and Singapore compete fiercely to be considered Asia’s premier financial centre . The riches held by Hong Kong’s tycoons have until now made the city the larger base for private wealth, boasting 853 individuals worth more than $100 million—just over double the number in Singapore-—according to a 2018 report from Credit Suisse
Professor Simon Young of the University of Hong Kong’s law school told Reuters that it was understandable that some Hong Kong residents might be considering moving assets out of the city given the little-noticed financial reach of the Bill.
Singapore Shift The head of a private banking operations of an international bank in Hong Kong said clients have been moving money out of Hong Kong to Singapore. “These aren’t mainland Chinese clients who might be politically exposed, but wealthy Hong Kong clients,” the banker said. “The situation in Hong Kong is out of control.”
The amendments seek to simplify case-by-case extraditions to jurisdictions, including mainland China , beyond the 20 with which Hong Kong already has extradition treaties.
As well as removing an explicit block on extraditions to mainland China in the current Fugitive Offenders Ordinance, the amendments also remove the restrictions on the mainland from the Mutual Legal Assistance in Criminal Matters Ordinance, known as the MLAO.
Paytm Postpaid to move its loan book to Clix
BENGALURU: Paytm Postpaid , the online credit business of the digital payments major Paytm, is transferring its loan book to Gurgaon-based non-banking finance company Clix Capital , in what could possibly be a fallout of regulatory scrutiny, people familiar with the development said.
While there is no exact clarity on whose financial book the loans were shown, one of the sources told ET that it was taken in the books of Paytm Mall , the e-commerce entity of Paytm. This comes at a time when in a parallel development a public interest litigation was filed in the Delhi High Court last month alleging Payments Bank was flouting regulatory norms by offering credit to its users. Paytm Postpaid is a credit offering through which customers can buy goods and services and make settlements later, similar to how credit cards and other Pay Later products work. The platform allows consumers to borrow up to Rs 60,000 and offers free credit period of 37 days.
As per the Reserve Bank of India rules, a payments bank is not allowed to extend credit and can accept deposits only up to Rs 1 lakh.
Taking up the PIL, the Delhi High Court had asked for responses from both Paytm and RBI.
Paytm PostPaid started off in partnership with private sector lender ICICI Bank, primarily for pre-approved bank customers who are Paytm users. The partnership either fell through or was not being extended to new users, and Paytm was taking the credit exposure on its own books, two people in the know of the matter told ET. However, in its ‘Frequently Asked Questions’ section meant to explain the service to the users, Paytm still says applications might get rejected because of data mismatch or credit policies set by ICICI Bank. “Credit is being offered by ICICI Bank for Paytm customers. Paytm is acting as a facilitator for the services,” it says.
Emails sent to Paytm and ICICI Bank for comment remained unanswered as of press time Sunday. An emailed query sent to Clix Capital and messages sent to its director Anil Chawla, too, did not elicit any response till press time. “While the deal was struck for existing bank customers who were to be offered the postpaid facility, for non-ICICI Bank customers the product could not work since there were issues around sharing of consumer data on either sides,” said one of the persons cited earlier.
The other source said partnerships between internet giants like Paytm and traditional lenders get stuck at the point of sharing of customer data. “With such huge user base, newage tech companies will eventually become competitors to banks as they foray into lending,” the person said.
Ride-hailing company Ola also offers a credit product, Ola Money Postpaid, which allows users to take rides and then pay only after 15 days. ET had reported in its January 21 edition that Ola had applied for a non-banking lending licence from the RBI.
Going forward, Paytm plans to leverage its partnership with Clix Capital to extend credit not only to its consumers but also its merchant partners, another person in the know said. “Paytm had been extending small credit to its merchant partners as a pilot, but going forward it will become an important offering to them which will help them expand their scope of business as well and in turn accept more payments through Paytm,” he said.