Refund not received in SBI or Payment deducted

 In case you have made payment via SBI Bank to any Merchant (say Amazon, Flipkart, Swiggy, Zomato Etc),  and the amount has been deducted but not received by Merchant then you need to check for 2 things

1) Merchant Reference number

2) Transaction Date

After obtaining these 2 things with you , you can check the status at following link

https://www.sbiepay.sbi/secure/transactionTrack 

Refund not received in Bank

You must ask for Refund Reference Number (RRN) from your merchant if he claims he has refunded the money to your Banker. 

Report UPI Fraud

 

In case of UPI Fraud

 

1)      Keep 12 Digit Transaction number handy 

2)      Get the VPA address of the person to whom transfer has been made.

3)      Report the fraud at following link

https://www.npci.org.in/what-we-do/upi/dispute-redressal-mechanism

Alternatively 

• Visit the ‘get in touch’ page through the BHIM UPI app. You will find three segments- query, complaint and feedback
• Choose the complaint segment, you will need to choose the type of complaint to register (transaction/cashback, login, etc.)
• Fill in the information as required such as type of issue, virtual payment address (VPA), email ID, date of transaction, registered mobile number and comment to briefly explain the issue
• Once you file the mandatory field, enter the captcha code and submit
• The response to the complaint will be mailed to your registered email ID by the customer support team of BHIM UPI

Appointment of Bank's CMD

Typically, for every two positions, at least three people need to be interviewed.As there have not been too many executive directors who could meet both conditions, the government relaxes one of them. It stuck to the two-year residual service condition but decided to overlook the requirement for one-year experience.

This fast-track promotion policy has not gone down well with many. It’s not because relatively younger executives are set to become chiefs of banks but for the fact that the government is following different rules for different banks at different times and there is no uniformity in its approach. For instance, while selecting the SBI chief, the government dropped the two-year residual service clause. Four managing directors were called for the interview and only one of them had more than two years of service left. The government waived this clause and, at the same time, introduced a new one—irrespective of the years of service left, the minimum tenure of a State Bank chairman is now three years.

In fact, two members of Parliament have written to the government on this. One of them belongs to the Bharatiya Janata Party and another, the Shiv Sena. I don’t know what these two gentlemen have to do with the appointment of chiefs in public sector banks but their letters make one point clear that such appointments are sensitive, for politicians as well as Indian corporations who borrow from banks. At least two executive directors in the past had told that they had got calls from people willing to help them ahead of their interviews. Typically, such calls are made by chartered accountants who claim to be connected with relevant people. They do not ask for anything in return while offering their service. Both the executive directors claimed to have not entertained such calls as they were not willing the pay the price to the brokers for their service.

Typically, one is required to return the favour by giving loans to corporate houses and individuals who would later approach the chairman through these brokers. As a result of this, a bank may end up piling up bad assets. Such brokers also put pressure on a chairman for restructuring bad loans. Allegations made by these two executive directors could not be verified but the fact remains that the government looks vulnerable when it comes to the appointment of chiefs of public sector banks as the rules are often broken and made with the apparent intention to accommodate certain individuals. It is extremely difficult to prove this but one always gets the uneasy feeling that things are not done transparently. To defend its credibility, the central bank should disassociate itself from the process.

Maximum money that can be sent abroad as per RBI

The RBI prescribes separate limits for other remittances such as travel, education or medical expenses (see table). These limits are in addition to the limits prescribed by the LRS.

Purpose	Limit
Private travel	$10,000 per financial year
Business travel	$ 25,000 per trip
Studies	$ 1,00,000 per academic year
Medical treatment	$ 1,00,000 per financial year
Liberalised Remittance Scheme	$ 2,00,000 per financial year

These limits are also gross limits. That is, you can remit up to these limits out of the country irrespective of how much you bring in.

In 2004, Reserve Bank of India (RBI) announced the Liberalised Remittance Scheme (LRS). Thanks to this scheme, foreign remittances today can be freely made by residents to the extent of $2,00,000 per financial year. Remittances made under the LRS can be used to buy property abroad or to invest in shares, mutual funds or debt instruments in any foreign country without prior approval of the RBI.

While the scheme looks attractive on paper, it is ridden with several practical roadblocks. Confusion exists on what is allowed under the scheme, what documents are needed to be submitted and so on. Let us try to throw light on these practical aspects.

What can the LRS be used for?

LRS can be used for:

• Buying property abroad
• Investing in shares, securities, bonds, mutual funds abroad
• Opening and maintaining foreign currency accounts with banks outside India for carrying out the above mentioned transactions
• Gifts and donations abroad

For instance, if a customer decides to open a broking account abroad and deposits $2,00,000 (under the Liberalised Remittance Scheme) and later that year, decides he wants to withdraw all his money and open an account at another financial institution, he will not be able to do so.

What is not permitted under the LRS?

The following transactions are not permitted for remittance under the LRS:

·         · Transactions that are explicitly prohibited by RBI such as purchase of lottery tickets, sweepstakes etc

·         · Remittance from India for margins or margin calls to overseas exchanges

·         · Remittances for purchase of FCCBs issued by Indian companies in the overseas secondary market;

·         · Remittance for trading in foreign exchange abroad;

·         · Remittance by a resident individual for setting up a company abroad;

·         · There is also restriction on remittance to some countries like Bhutan, Nepal, Mauritius, Pakistan and certain other countries that are enlisted by the Government from time to time.

How does the bank verify your purpose of remittance?

At the time of making remittance, you would have to submit a self- declaration form stating the purpose of your remittance. The bank or authorised dealer will only go by your declaration.

What is the procedure to remit funds under the LRS?

Step 1: Approach your bank to make the remittance. If you have been an account holder in the bank for less than one year, you would need to provide copies of bank statement of the previous year or copies of the latest income tax return or assessment order.

Step 2: Submit the application cum declaration form A2

Step 3: Submit a draft for the amount you want to remit

While these are the only documents needed to be submitted, several banks ask for other documents such as a Form 15CA and 15CB.

In fact, a 2011 the RBI called for a review of the remittance facilities. The report recognized the need for clarity on remittance procedures:

‘There is no clarity or uniformity among ADs and while some ADs insist on the submission of the Form 15 CA/CB for remittances under the Liberalised Remittance Scheme (LRS), some insist only for remittances above US $ 5000 and some don't obtain Form 15 CA/CB at all. This is borne out by the survey results (Annex V) and is not an acceptable situation as it means some residents are subjected to unnecessary costs and harassment while others are not,’ the report stated. The report further went on to recommend, ‘To enable hassle-free remittances by resident individuals banks may be advised by RBI not to insist on the submission of form 15 CA/15 CB for any remittances under the Liberalised Remittance Scheme (LRS).’

We can hope that the process becomes clearer and more transparent in the coming days.

An individual needs to be very well aware of these limitations. There is an extensive list of FAQs on the RBI site which might be helpful. Although some of it might still be unclear, we recommend that you go through it to understand the requirements. One needs to go into the bank, educated, before giving the bank an opportunity to pose difficulties. Most the time, it's the bank which is actually unaware of the LRS process.

Please note that aforesaid limits are prescribed by RBI and not under Income Tax Act. The exempted purposes under Income Tax Act can be read here at http://ankit221215.blogspot.in/2013/10/all-about-form-15cb.html

What is Margional Standing Facility

What is MSF?

MSF is a relatively new instrument. RBI first announced about MSF in the annual policy review for the financial year 2011-12; the concept came into existence on 9 May 2011.

Under the facility, all scheduled commercial banks can borrow overnight from the central bank up to 1% if their net demand and time liabilities. The facility is available for banks on all working days, except Saturdays. The interest rate was fixed at 100 bps above the repo rate. Repo rate is the rate at which scheduled commercial banks borrow from RBI for the short term.

Under MSF, banks can request for a minimum of Rs.1 crore and thereafter in multiples of Rs.1 crore. In order to avail funds from MSF facilities, banks have to fulfil the margin requirement of 5% in case they are borrowing against the government of India dated securities and 10% in case they wish to borrow against state development loans. Therefore, to make a request for, say, Rs.100, banks have to furnish Rs.105 worth of government of India bonds or Rs.110 worth of state development loans.

Why is MSF useful?

The facility was introduced in order to contain volatility in the inter-bank overnight market. With MSF, RBI created a 200 bps corridor in policy rates with repo rate in the middle and MSF at 100 bps above the repo rate and reverse repo at 100 bps lower than the repo rate.

Relation Between Bank rate and Govt Rate

Interest rates in India are much lower than they should be given the rate of consumer price inflation and the rate of economic growth. The return on a 10-year government bond as of now is around 7.4%. A 10-year government bond is a bond sold by the Indian government to finance its fiscal deficit or the difference between what it earns and what it spends. Anyone investing in a bond basically looks at three things: the expected rate of inflation, the expected rate of economic growth and some sort of risk premium to compensate for the risk of investing in the bond. These numbers are added to come up with the expected return on a bond.

The consumer price inflation in the month of May 2013 stood at 9.31%. As per most forecasts the Indian economy is expected to grow at anywhere between 5-6% during this financial year (i.e. the period between April 1, 2013 and March 31, 2014). Lets assume that lending to the Indian government is considered to be totally risk free and hence consider a risk premium of 0%. Also to keep things simple, lets assume a consumer price of inflation of 9% and an expected economic growth of 5.5% during the course of the year. When we add these numbers we get 14.5%. This is the rough return that a 10-year Indian government bond should give. But the return on it is around 7.4% or half of the projected 14.5%.

The reason for that is very simple. Indian banks need to maintain a statutory liquidity ratio of 23% i.e. for every Rs 100 that a bank raises as a deposit; it needs to compulsorily invest Rs 23 in government bonds. Hence, banks (and in turn citizens) are forced to lend to the government. Similarly, Life Insurance Corporation of India also invests a lot of money in government bonds. So there is a huge amount of money that gets invested in government bonds. This ensures that returns on government bonds are low in comparison to what they would really have been if people and banks were not forced to lend to the government. The return on government bonds acts as a benchmark for interest rates on all other kind of loans. This is because lending to the government is deemed to the safest, and hence the return on other loans has to be greater than that, given the higher risk.

If the 10-year bond yield would have been at 14.5%, then the interest rates on loans would have been greater than 17% (14.5% + 285 basis points). But since the government forces people to lend to it, the interest rates are lower. This act of the people being forced to lend to the government is referred to as financial repression.

This means our savings will increasingly be diverted to government interests, whether or not those interests really deliver a good rate of return for society.  While this may happen in the Western societies as governments resort to financial repression to repay the huge amounts of debt that they have accumulated, it is already happening in India. Financial repression is a major reason behind the Congress led United Progressive Alliance (UPA) government going in for a large number of harebrained social programmes (the most recent being the right to food security, which has been brought in through the ordinance route). They know that money required for all these programmes can easily be borrowed because 23% of all bank deposits need to be invested in government bonds issued to finance the excess of government expenditure over revenue.

This is also why interest rates offered on bank fixed deposits are close to the rate of consumer price inflation, leading to a zero per cent real rate of return on investment. This is also makes people buy gold and real estate and invest in Ponzi investment schemes, in search of a higher rate of return.

Banks raise deposits at a certain rate of interest and then give out loans at a higher rate of interest. So unless the interest rate offered on deposits goes down, the rate of interest charged on loans cannot come down.

Banks are not in a position to cut interest rates on deposits as of now. Hence, it is not possible for them to cut interest rates on loans. Any bank which cuts interest rates on loans will essentially end up with lower profits. Also even if interest rates on loans are cut, it may not lead to people borrowing and spending money.

Lets first consider car loans. Car sales have fallen for the last eight months in comparison to the same period during the year before. High interest rates are a reason offered time and again for slowing car sales. But some simple maths tells us that can’t really be the case.

Lets consider the case of an individual who borrows Rs 5 lakh to buy a car at an interest rate of 12% repayable over a period of 7 years. The equated monthly instalment for this works out to Rs 8826. Lets say the bank is able to cut the interest rate by 0.5% to 11.5%. In this case the EMI works out to Rs 8693, or Rs 133 lower. Even if the bank cuts interest rates by 1%, the EMI goes down by Rs 265 only. If we consider a lower repayment period of 5 years, an interest rate cut of 0.5% leads to an EMI cut of Rs 126. An interest rate cut of 1% leads to an EMI cut of Rs 251. The point is that no one is going to go buy a car because the EMI has come down by a couple of hundred rupees.

With the uncertainties prevalent today, a consumer does not know what his job would be like after a year – whether or not he will have an incremental income, or even a job. Of course when people are not buying cars, it is unlikely they will buy homes, unless we are talking about those who have to put their black money to use. A cut in interest rates will bring down EMIs significantly on home loans. But even with lower EMIs people are unlikely to buy homes. This is because the cost of homes especially in cities has gone up big time making them totally unaffordable for most people.

The broader point is that just asking banks to cut interest rates doesn’t make any sense without trying to address the other issues at play.

Fake Note Detected by Bank

As per RBI Instructions:- 

i. Detection of counterfeit notes, at banks, should be at the back office / currency chest only. Banknotes when tendered over the counters may be checked for arithmetical accuracy and other deficiencies like whether there are mutilated notes, and appropriate credit passed on to the depositor / account or value in exchange given.

ii. There will not be any requirement to issue acknowledgement to the tenderer.

vi. In the cases of detection of upto four pieces of counterfeit notes, in a single transaction, consolidated monthly statement (Annex II) should be sent to the Nodal Police Station through the Nodal Officer of the bank. In case of detection of five or more pieces, FIR in the prescribed format (Annex III) should be lodged.

vii. Banks should monitor the patterns / trends of such detection and suspicious trends / patterns should be brought to the notice of RBI /Police authorities immediately.

viii. The reporting procedure to the Regional Offices of RBI in the prescribed format (Annex IV) will remain unchanged.

2. Compensation to banks

i. The banks will be compensated by RBI to the extent of 25 % of the notional value of the counterfeit notes of Rs 100 denomination and above, detected and reported to RBI and Police authorities.

ii. Claims for compensation should be made through the Forged Note Vigilance Cell of the banks in the prescribed format (Annex V) on a monthly basis through email within fifteen days of the succeeding month.

iii. Reimbursement will be done by RBI, Department of Currency Management, to begin with, on a quarterly basis.

iv. A review of the above system will be conducted after one year.

3. Penalties

i. Penalty on account of detection of counterfeit notes by RBI from soiled note remittance of banks and in currency chest balances will henceforth be three times the notional value of the counterfeit notes.

ii. In case it is found during RBI inspection, etc. that a bank branch or currency chest has detected counterfeit notes but not reported the same to RBI or Police, strict regulatory measures against the bank including stringent disciplinary action and / or imposition of monetary penalty, will be taken by RBI

Format for impounding stamp

Each banknote, which, on examination of various security features / parameters, is determined as a counterfeit one, shall be branded with a stamp "COUNTERFEIT BANKNOTE". For this purpose, a stamp with a uniform size of 5 cm x 5 cm with the following inscription may be used.

COUNTERFEIT BANKNOTE IMPOUNDED

BANK / TREASURY/ SUB-TREASURY

BRANCH / CURRENCY CHEST

SIGNATURE

DATE