Press Coverage-Banknet India's Third Annual Conference on Payment Systems in Banks
Mr M V Nair, Chairman & Managing Director, Union Bank of India inaugrated the Banknet India's Third Annual Conference on Payment Systems in Banks on the 10th January 2007 at Mumbai. Mr. Arvind Sharma, Member Secretary, Governing Council and Director, IDRBT was the Guest of Honour and spoke on reach of Banking to unbanked and underbanked areas. Mr Kaza Sudhakar, CGM, Customer Services Department, RBI delivered the Key Note Address on Consumer & Service issues in Payment Systems. 20 prominent speakers from the major banks & IT Cos addressed more than 350 participants from more than 100 banks, FIs, insurance cos & others.
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Conference was covered by The Economic Times, The Times of India, Financial Express, Business Standard, The Hindu-Business Line, DNA Money, PTI, Money Control.com, Worldnews.com, Securities.com, Aaj Tak TV etc.
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Further rate hikes may hit offtake
Business Standard
BS Reporter, January 11, 2007
Any further escalation in interest rates from the current elevated levels is seen hurting banks, even as expectations are growing that the Reserve Bank of India (RBI) would again tighten monetary policy at its review slated for the end of this month.
“Any further increase in (lending) interest rates may not be in the interest of the business (of banks),” Union Bank Chairman and Managing Director M V Nair said on the sidelines of a seminar on payment systems in banks.
The fear of another round of interest rate hikes hurting banks follows a slowdown in demand for home loans, which, to a great extent, had led the unprecedented growth in bank credit expansion in the last three years.
Along with State Bank of India (SBI) and ICICI Bank, Union Bank of India too has experienced a slowdown in home loan demand because of the increase in lending rates and manifold spurt in property prices.
Nair said non-triple-A rated corporate clients face the prospect of having to pay interest rates of 15 per cent and more, from around the levels of PLRs now.
Such high rates could impact profitability of corporates and put a question mark over the affordability of bank funds. Individuals could be postponing decisions on purchasing homes hoping for a sharp correction in property prices.
“However, this does not mean banks will take conscious steps to reduce credit activity. Lending is the basic activity which banks will pursue where ever they find opportunity,” he pointed out.
Commercial banks have raised their PLRs by up to 150 basis points in three tranches in the current financial year.
The latest round of PLR hikes, the third one, was triggered by the RBI’s decision in early December to raise cash reserve ratio (CRR) by 50 basis points to 5.5 per cent to contain inflationary expectations.
Prime lending rate increase likely to hit industry
The Financial Express
BANKING BUREAU, January 11, 2007
Expressing his concern over the rising interest rates, MV Nair, chairman and managing director, Union Bank of India, said that any further rise in the lending rates will not be in the interest of business particularly those businesses which are given loans at above the benchmark prime lending rate (PLR).
"Our PLR is currently at 12% and the rate for above PLR lending is close to 15%. Any further rise in interest rates will not be in the interest of business," he said on the sidelines of the third 'Banknet Conference on Payment Systems in Banks'. He added that large and AAA rated corporates have other avenues to fund their investments, but smaller companies have no such avenues and as such a further rise in interest rates will affect them.
He admitted that Union Bank’s home loan growth has fallen due to the series of rate hikes last year.
It has hiked its PLR by 125 basis points in the current financial year so far. Many banks like SBI, ICICI Bank have witnessed slowdown on their home loan portfolio in the wake of PLR hikes.
When asked about the impact of rate hike on retail credit, he said that there is a slowdown in retail credit but that is not attributable only to the rate hike. The high real estate prices and interest rate hike inter alia have resulted into slowdown of the retail credit.
Earlier in his opening remarks he stressed the need to ramp up technology based delivery channels especially in the rural areas.
Drawing parallel from the success of Amul Co-operative movement, he said that technology should be leveraged to benefit all the participants in the supply chain.
Highlighting the downside of co-branded credit/debit cards like compromising with the personal information of individuals, higher interchange settlement cost etc, he said that there is possibility of floating a new card branding like Visa/Master for card operations.
Float India branded credit, debit card: Banker
NewKerala.com
Business India News, January 10, 2007
Union Bank of India Chairman and Managing Director M V Nair today suggested floating an India branded credit or debit card on the lines of Visa/MasterCard to reduce costs and minimise value of interbank liabilities.
"Banks in India have scope to establish a national payment switch using the Institute for Development and Research in Banking Technology's (IDRBT) INFINET network and can explore possibility of floating a new card branding like Visa/Master for card operations," he said while addressing the third Banknet India conference on payment systems here.
This will reduce costs and also minimise the value of inter-bank liabilities arising out of card transactions as settlement will take place through RBI.
Nair said processing of card transactions through Visa and MasterCard at international locations poses risk to the personal information of individuals.
Nair suggested ramping up technology based delivery channels in the rural areas, like biometric ATMs, which should be cost effective and user friendly.
Banknet India to focus on e-payment systems
The Times of India
TIMES NEWS NETWORK, January 9, 2007
Banknet India, focused on banking knowledge and research and one of the largest organisers of banking industry conferences, is organising the Third Annual Conference on Payment Systems in Banks on January 10 at Taj Lands End, Mumbai.
The conference will be inaugurated by MV Nair, CMD, Union Bank of India, and will focus on automated clearing house, ECS, RTGS, NEFT, cheque truncation, ATMs, internet banking, mobile banking, card payments, technology and security issues in electronic payment systems, international remittance services et al.
Banknet India's Second Annual Conference on Payment Systems in January last year had 550 participants from more than 100 banks and financial institutions and nearly 50 IT companies worldwide.
The conference is being organised in view of the quantum leap forward made by Indian banks and financial service providers in terms of switching over from paper-based transactions to electronic means, RTGS, NEFT and other electronic modes. The theme of the conference is Moving towards Electronic Payment Systems.
It will also provide an opportunity to participants to get first hand insight on payment and settlement systems from the officials of RBI and major banks.