BUSINESS
Banking Central | Pushing credit to borrowers beyond capacity sets off stress alarm on small loans
There are signs of a large-scale borrower distress at the small borrower levels. This could have a spillover effect in the overall banking system if the trend persists
BUSINESS
What do SBI’s July-September numbers tell us?
SBI numbers suggest an overall improvement in performance, rebalancing of loan growth from retail to corporate/SME and improvement in asset quality
BUSINESS
Banking Central | How tough is the life of a banker in India?
As a bank executive, you need to deal with money every single day, the targets set by superiors and, lastly, the wrath of angry customers. It’s a tough life.
BUSINESS
Moneycontrol Pro Interview | Keertana Finserv MD Padmaja Reddy points to a crisis brewing in microfinance
Reddy, who previously founded Spandana Sphoorty Financial Ltd warns that borrowers are severely over-leveraged, with more than 50 percent of borrowers having between 6 to 15 loans, with their EMIs far exceeding their household incomes
BUSINESS
What do cash usage data from the past 12 years tell us?
Indians are gradually letting go of cash for transactions, but cash is still king. The Cash Usage Indicator data shows a gradual decline in cash usage, but even then cash remains significant in the lives of Indians.
BUSINESS
Chart of the Day | Here’s how the major source of financing for Indian MSMEs changed, post pandemic
Covid presented one of the biggest challenges to small firms as funding from institutional sources dried up. However, the timely actions by the Government and the RBI by way of funding support and moratoriums on loan repayments helped these firms tide over the crisis.
BUSINESS
Unsecured loan books develop cracks. How big a worry is this for Indian lenders?
For years, banks and NBFCs were engaged in an intense rivalry to grow their loan books, perhaps forgetting the cardinal rule of lending—assessing a borrower's creditworthiness. Probably, they are having to pay a price for it now
BUSINESS
Banking Central | Time may be right for RBI to frame rules on use of AI in banking
RBI Governor Shaktikanta Das recently advised the banking sector to approach AI adoption with caution
BUSINESS
Moneycontrol Pro Panorama | Retail loan parade of non-banks is over
In October 24 edition of Moneycontrol's Pro Panorama: FII selling fuelled by US interest rates, urban FMCG demand stress a cause of concern, October MPC minutes reveal members' dovish mindset, Russia looks victorious in battle of attrition with Ukraine, and more
BUSINESS
Chart of the Day | Indian banks are increasingly adopting AI in their daily operations
As per the RBI article, while both private and public-sector banks are increasingly emphasising on AI and related technologies, the pace of increase is higher for private banks
BUSINESS
October MPC minutes show there is a dove in the new batch of external members
Nagesh Kumar, the only MPC member who voted for a rate cut in the October policy, argued that a rate cut could help revive demand and help boost private investment. Kumar makes a convincing argument for a rate cut
BUSINESS
For RBI researchers, a durable alignment with inflation target is now in sight
Interest rate hikes have worked well to contain demand and inflation, says an article co-authored by deputy governor Patra in the RBI Bulletin. The RBI has hiked interest rates by 250 basis points since May 2022 to fight inflation
BUSINESS
RBI's proactive action on MFIs shows some firms failed to learn from the 2010 crisis
The RBI had given sufficient time to MFIs charging excessively high rates to revise their interest rates downwards. Some got the message; some didn’t.
BUSINESS
Banking Central | How banks can check the flight of funds and get savers back
Bank deposit rates need to be hiked by at least 1-2 percent to woo back the depositor. Else, they need to prepare for alternative borrowing sources to raise resources
BUSINESS
Moneycontrol Pro Panorama | RBI flags emerging challenges to monetary policy framework
Moneycontrol's Pro Panorama October 16 edition: The future of loan demand as envisioned by bankers, conflict and chaos affects global merchant trade, high-end real estate gets a breather from millennials, states should consider taxing agriculture, and more
BUSINESS
Chart of the Day | What do bankers think of loan demand going forward?
Bankers are bullish. This optimism could be due to the increased capex spending plans of corporations and start of a lower interest rate era that could spur consumer demand
BUSINESS
RBI’s confusing messaging on Big Tech, AI risks to banks is not helping
The RBI governor’s caution regarding the perils of excessive technology in banking isn’t new. We have heard this warning before. Does the regulator know something that we don’t?
BUSINESS
Don’t read too much into the Great Indian Rupee Melodrama
The rupee is swaying to global whims, not tanking. A gradual depreciation in the rupee's value could be part of the RBI's plan to neutralise excess capital inflows
BUSINESS
Banking Central | How RBI tells banks to mind their core in the age of financial supermarkets
The trigger for the circular could have been rapid expansion of non-core businesses by banks across group entities, selling same products across different group companies.
BUSINESS
Shaktikanta Das’ warning on ‘growth at any cost’ is an eye opener for aggressive MFIs
Some NBFCs have been pushing credit to customers beyond their borrowing capacity by imposing stiff performance targets on employees
BUSINESS
Quick Take | As RBI changes stance to 'neutral', countdown begins for a rate cut in Dec
The MPC has given a clear signal that a rate rethink isn’t too far by changing the monetary policy stance. When and how will depend on the inflation trajectory
BUSINESS
Chart of the Day | A look at the link between vegetable prices and food inflation
Vegetable prices are a decisive factor in determining inflation trends at this point. There are early signs of food inflation easing but it is too early to say for sure. The MPC should be more worried about vegetable prices now than the Israel-Iran skirmish
BUSINESS
Banking Central | What RBI rate-setters are planning as inflation warriors face a crude threat
The MPC is scheduled to meet on October 7-9 to decide the interest rates
BUSINESS
Will Iran-Israel war cause an agenda shift in the just rejigged MPC?
The MPC meet scheduled for October 7-9 will mostly likely set the ground for a rate cut two months later. The MPC is set to reverse its rate stance unless big surprises happen in the meantime
