11 Learning’s from the Ola Cabs Price Revision

          The Inspiration to today’s Post is this mail from www.olacabs.com to its registered users:

The mail is quoted ad verbatim :::

Quote

Prices Revised!

At Ola, our aim has been to provide easy, accessible and affordable transport solutions to the widest number of people. One of the ways we do so is by redefining our pricing structure in order to offer a simpler and more transparent pricing structure that benefits the maximum number of people. With that intention, we have revised our fares. Now, you don't need to hesitate to take an Ola even for shorter distances.

	THEN	NOW
Mini	Rs 100/ 6 kms	Rs 80/ 4 kms
Sedan	Rs 150/ 8 kms	Rs 100/ 4 kms

With this update, we have also done away with waiting charges. You will now be billed for Ride Time @ Re.1/min, starting from your pickup time. Ride time calculations will kick-in only after the driver has reached your pickup point. If the driver is late you will not be billed for the delay. First five minutes of your ride time are free.

So, take an Ola wherever you go. After all, a ride is always around the corner.

Unquote

11 Learning’s from the Ola Cabs Price Revision

01)  ‘The customer is king’ part is over. The seller has become the king.

02) Nothing in this world is free. Premium has to be paid by the late adapters to a technology.

03) Read mails carefully from eCommerce Companies.

04) Understand the power of differential pricing. For eg, different rates apply to Ola customers in different cities.

05) Join User groups to receive quick updates on changes to Most Important Terms and Conditions.

06) Do not post spam in the respective user groups. Spam is killing us.

07) Be prepared of new techniques to lighten your wallet.

08) Wherever you are utilising the service of eCommerce companies, seek clarification from your company’s administrative department that all charges levied by eCommerce companies will be reimbursed.

09) Petition the authorities wherever you feel that the unfair charges are being levied with appropriate evidence.

10)  Learn to accept change.

11)  Do not get addicted to eCommerce companies. 

11 observations on Reserve Bank of India’s monetary penalty on three Banks; cautions Eight

01)   Today vide a Press Release RBI has announced that it has imposed monetary penalty on the following three banks for violation of Reserve Bank of India instructions:-

Sl. No.          Name of the bank           Penalty Amount (in ` mn)

1.                  Bank of Maharashtra                   15

2.                  Dena Bank                                      15

3.                  Oriental Bank of Commerce       15

02)   Broadly RBI guidelines on ‘Know Your Customer (KYC)’, and ‘Anti Money Laundering (AML)’, were violated.

03)   Eight other banks, namely, Central Bank of India, Bank of India, Punjab and Sind Bank, Punjab National Bank, State Bank of Bikaner & Jaipur, UCO Bank, Union Bank of India and Vijaya Bank have been cautioned to put in place appropriate measures and review them from time to time to ensure strict compliance of KYC requirements in future.

04)   The penalties have been imposed in exercise of powers vested in the Reserve Bank under the provisions of Section 47(A) (1) (c) read with Section 46(4)(i) of the Banking Regulation Act, 1949.

05)   RBI has clarified that action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank and its customers.

Background

06)   On the basis of a complaint received by the Reserve Bank from a private organisation, a scrutiny of fixed accounts opened in its name in Mumbai based branches of certain public sector banks was undertaken in July 2014.

07)   With more complaints and involvement of other banks coming to light, a wider thematic review was conducted and in all 12 branches of 11 Public Sector Banks was covered. The scrutiny/thematic review looked into the modus operandi of the alleged frauds involving accounts of certain organisations in these banks, deficiencies / irregularities while opening Fixed Deposits (FD) and extending Overdraft (OD) facility there against.

08)    Besides the effectiveness of systems and processes in place pertaining to implementation of KYC norms / AML standards in respect of these accounts was also looked into.

The findings revealed violation of certain regulatory guidelines issued by the Reserve Bank as also other disquieting actions on the part of the banks, as under:

·       non-adherence to certain aspects of KYC norms of the Reserve Bank like customer identification and acceptance procedure

·       non-adherence to the Reserve Bank’s instructions on monitoring of transactions in customer accounts

·       non-adherence to the Reserve Bank’s instructions regarding funds received through Real Time Gross Settlement System (RTGS)

·       opening of fixed deposit accounts and granting overdrafts there against without due diligence or process

·       weaknesses in the internal control systems, management oversight, use of internal accounts for parking customer funds, etc.

·       involvement of middlemen/intermediaries in opening of the accounts as also subsequent operations in those accounts

09)   Based on the findings, the Reserve Bank issued a show cause notice to 11 banks, in response to which the individual banks submitted written replies. After considering the facts of each case and individual bank’s reply, the Reserve Bank came to the conclusion that some of the violations of serious nature were substantiated and warranted imposition of monetary penalty on three banks, namely, Bank of Maharashtra, Dena Bank and Oriental Bank of Commerce. 

10)   Failure on the part of the above three banks to take timely remedial measures had aggravated the seriousness of the contraventions and its impact.

11)   In respect of eight other banks, namely, Central Bank of India, Bank of India, Punjab and Sind Bank, Punjab National Bank, State Bank of Bikaner & Jaipur, UCO Bank, Union Bank of India and Vijaya Bank, based on written and oral submissions, it was decided not to impose any monetary penalty as the banks’ explanations were judged to be reasonable. 

11 Motivators for Indian Companies to appoint Chief Green Officers

01)  Reserve Bank of India has taken the lead in ‘eTree Certificates’.

02) No more bouquet of flowers at Reserve Bank of India meetings and functions will be visible.

03) Instead, guests or participants will get ‘tree certificates’, as proof of trees having been planted on their behalf on the bank’s campus.

04) An IDBRT discussion paper also mentions about Chief Green Officers.

05) The paper outlines the responsibility of Chief Green Officers in Financial Institutions.

06) As the social awareness about Green initiatives is on the increase, Financial Institutions might add a condition in their loan agreement that corporate should have visible green initiatives.

07) Green is the way to safe-guard our environment.

08) Green is the way to hand over the earth to our future generations.

09) Chief Green Officers are expected to channelize the institutions Green efforts optimally.

10)  The spin-off for Financial Institutions appointing Chief Green Officers are immense.

11)  Chief Green Officers can play a positive role in corporate’s CSR activities being more meaningful. 

10 Safety Tips for your Samsung Pay

          Some Indian eTransaction enthusiasts have been able to lay their hands on a official Samsung Pay Phone.

          The Samsung S6/S6 Edge contains Samsung Pay features. In very simple terms, Samsung Pay enables Samsung S6/S6 Edge owners to pay their bills electronically at POS (Point of Sales) Terminals.

          There is no dependency on NFC (Near Field Communication) as Samsung Pay relies on new proprietary technology called Magnetic Secure Transmission (MST).

          The word ‘Samsung Pay’ is not mentioned in India’s Samsung Product webpage.

          At the same time, ‘Samsung Pay’, word is specifically mentioned in Samsung mobile press webpage.

10 Safety Tips for your Samsung Pay

01) Keep it in your sight.

02)     Discard expired credit card details.

03)     Discard debit card details of closed bank accounts.

04)     Remember to recharge your prepaid cards, if you intend to link them to your Samsung Pay

05)     Check any SMS received your credit card company to ensure that it is a genuine transaction.

06)     Keep the fingerprint scanner free of dust.

07)     Activate the ‘You Can Now Find Your Lost Phone by Googling it’ Theis feature works on the desktop and with the Google search app only when you’re signed into the same Google account on your phone and on your desktop.  This is not a big deal isn’t it?

08)     Do not root your The Samsung S6/S6 Edge Smartphone,  as rooting your Sam may disable the ‘Samsung Pay’ feature.

09)     Enable the Samsung’s Find my Mobile feature.

10) Insure your The Samsung S6/S6 Edge Smartphone

          

The next eCommerce Frontier in India – Overdraft Finance for Shoppers

          The chief inspiration for today’s blog Post is the Star Trek Quote – “Space - Where no man has gone before"

          The eCommerce arena in India is witnessing an explosive growth with the pool of Online Shoppers increasing every minute.    

     

          This Forbes article reflects the trend.  

          One of the main reasons as to why shoppers still prefer mom and pop retail stores is the informal overdraft facility.

          Any reasonable sized mom and pop store offers overdraft facilities ranging from INR 250\-to INR5000\-.

          These overdraft facilities are offered without any security and are based on trust.

          The default levels of such overdraft are very low.

          Today’s post explores the market and the process flow for introducing Overdraft facility for online shoppers.

Q: What is an Ovedraft?

Ans:  Overdraft is an Loan arrangement under which a bank extends credit up to a maximum amount (called overdraft limit) against which the account holder can write checks or make withdrawals. An overdraft is a type of revolving loan where deposits (credits) are available for re-borrowing, and interest is charged only on the daily overdraft (debit) balance.

The most famous overdraft facility in India is the PMJDY Overdraft facility.

Q: How different is from EMI financing?

Sr No	Overdraft	EMI Loan
01)	This is like a revolving credit. There can be Debits (Withdrawals) and Deposits (Credits) in the account. Debits (Withdrawals) can be made upto the set limit.	Single Debits (Withdrawal), multiple credits
02)	Interest is charged on the daily withdrawal outstanding at the end of every month.	Interest is collected along with part of the Principal every month.
03)	Petty shopkeepers or Wholesale shopkeepers offer informal overdraft facilities. The interest portion is built into the selling price.	EMI Loans are offered by Banks or financial institutions.

Q) What are the finance options available to Online Shoppers in India?

Ans: The most common finance options in India to Online Shoppers are the EMI loans from the Credit Card Companies.

These EMI options are available only for the respective credit card holders only. New online shoppers cannot avail the EMI options.

Check out on this Google Search for more information on EMI Options.

No Finance Company in India offers Overdraft facilities, more so for online shoppers.

A couple of finance companies do offer EMI loans to online shoppers. Check out here for one such tie up between an eCommerce Company and a Finance Company.

This tie-up is a mix of online and offline model.

It is not a full fledged online model.

The following is a full-fledged model.

01) Customer profiles are created based on eKYC and allot unique customer codes.

02)                  Fix overdraft limits as per risk profile of the customers.

03)                  Obtain NACH (Debit) mandate for recovery of the monthly interest. The upper limit can be fixed as per the Overdraft Limit of the customer.

04)                  Tie up with eCommerce companies wherein the customers can interact with the finance company to finance his/her purchases till the eligible limit.

05)                  Raise alarm when the NACH(Debit) transaction is returned with any reason; financial or non-financial reason.

This Model is most suitable for Finance Companies, though Banks can also consider adopting it.

This model has the following benefits:-

a)    Increase the pool of new customers for eCommerce companies.

b)    Increase the pool of new customers for Finance companies.

c)    Encourage online customers to build a positive credit report.

d)    Encourage Digital India Transactions.

e)    Introduce advanced fraudulent detection techniques.  

f)    Introduce new earning streams for eCommerce/Logistics personnel.

g)    eCommerce companies need not invest for finance.

h)    The processing charges, if any, can be paid by the eCommerce companies if the purchases are beyond a specified level.

                   

Check out this Google search results for the various contours of ecommerce in India