WEEKLY FINANCIAL SNIPPETS- 26/11/2016
1. POST –DEMONETIZATION EFFECTS:
A) PAN REQUIRED IF COMBINED CASH DEPOSITS EXCEED Rs.2.5LAKHS TILL DECEMBER 3Oth :
The limit for cash deposit in an account is less than Rs.50000/- per transaction per day
without PAN card. But now the government has announced that cash deposits made
between 8th
November to 30th
December will require PAN proof if the combined deposits
cross Rs.2.5 lakhs.
B) SUSPECT CASH DEPOSITS WILL ATTRACT IMPRISONMENT:The I-T department has warned
people that if it is found that they are depositing their unaccounted money in someone
else’s account, they will be charged under the Benami Transactions Act that carries penalty,
prosecution and rigorous jail term.
C) RBI GIVES BORROWERS 60 MORE DAYS TO REPAY LOANS:The reserve Bank of India has
allowed banks, District cooperative banks and NBFCs to retain “Standard” asset classification
on loans up to 1 crore for another 60 days from the date it would have turned non-
performing(NPA).
D) RBI SETS STIFF RIDERS FOR Rs.2.5 LAKH WITHDRAWALS FOR WEDDINGS: The RBI has
permitted banks to allow withdrawals up to 2.50 lakhs for wedding purpose but with stiff
riders. It says the money can be withdrawn only from the credit balance prevailing in the
account before 8th
November. Further it states that such cash withdrawals should be used
only to make payments to those who do not have any bank account and names of such
recipients should be mentioned at the time of withdrawal.
E) RBI BALANCE SHEET MAY TAKE A HIT: All the banks are parking their accumulated cash
with the RBI and this will have a negative impact on RBI balance sheet. RBI is already
strained at meeting the pressure of supplying fresh notes to banks. RBI could be running out
of enough securities to offer to banks against heavy cash deposits and experts say that the
RBI now urgently needs policy measures to protect the financial stability of its books.
F) MUTUAL FUNDS EXPECT HUGE INFLOWS FROM RETAIL INVESTORS: Due to the
demonetization which will ease inflation, and which has already resulted in reduction in
bank deposit interest rate, the Mutual Fund industry is preparing for a huge inflow of funds
as it may lead to investors to tap investment avenues like mutual funds.
G) FOREX SALE DECREASES OVER 50%: Demonetization has led to an overall downslide in
average overall forex sales following a sharp crunch of foreign currency supply in the market.
2 AIRTEL LAUNCHES INDIA’S FIRST PAYMENTS BANK: Airtel has rolled out India’s first
payments bank from Rajasthan. After getting its licence from RBI, Airtel has entered into an
MOU with Kotak Mahindra Bank. Airtel is offering 7.25% interest on savings bank accounts.
The account will be fully digital and paperless. It will not issue any ATM/debit cards to its
account holder but will allow cash withdrawals from its designated Airtel retail outlets.

Customers with an Airtel mobile connection will have the mobile number as their account
number.