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Tag Archives: Banking

Why banks don’t sleep

Avariciousness, greed, unhindered lust for money. money at any cost – if any of these sound similar then you are probably reading the case about the ANZ Bank case regarding overcharging credit card accounts.

Here is how it goes. The bank issues you a card. You link the card to a savings account. And there is an automatic debit that happens on your savings account on the day of your card due. The credit card system invokes the auto debit functionality. And on that day the savings account is not adequately funded. Therefore the request is returned.

And the bank charges you the following :

  1. Penalty for Insufficient balance in your savings account.
  2. Penalty for standing instruction dishonour in your savings account.
  3. Late payment charges for your card.
  4. Interest charges for your card.

And you pay for four cases when you could have paid the due directly in the bank branch for your card.

The courts have found that this multiple charging practice to be unethical and illegal and have fined the bank USD 220Mn.

There are other banks who are waiting to be hauled over this credit card fee issue.

And did I hear somebody mention ‘ethical business practice’, ‘compliance’, ‘value the customer’ etc.

Now the others who don’t sleep, who are here for good and the world’s local banks are spending sleepless nights.

You reap as you sow, right ?

 
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Posted by on February 6, 2014 in Writers

 

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Why banks don't sleep

Avariciousness, greed, unhindered lust for money. money at any cost – if any of these sound similar then you are probably reading the case about the ANZ Bank case regarding overcharging credit card accounts.

Here is how it goes. The bank issues you a card. You link the card to a savings account. And there is an automatic debit that happens on your savings account on the day of your card due. The credit card system invokes the auto debit functionality. And on that day the savings account is not adequately funded. Therefore the request is returned.

And the bank charges you the following :

  1. Penalty for Insufficient balance in your savings account.
  2. Penalty for standing instruction dishonour in your savings account.
  3. Late payment charges for your card.
  4. Interest charges for your card.

And you pay for four cases when you could have paid the due directly in the bank branch for your card.

The courts have found that this multiple charging practice to be unethical and illegal and have fined the bank USD 220Mn.

There are other banks who are waiting to be hauled over this credit card fee issue.

And did I hear somebody mention ‘ethical business practice’, ‘compliance’, ‘value the customer’ etc.

Now the others who don’t sleep, who are here for good and the world’s local banks are spending sleepless nights.

You reap as you sow, right ?

 
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Posted by on February 6, 2014 in English Posts, Writers

 

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A short course on greed

Atrocious, obnoxious, illegitimate, against all decency, not at all acceptable, greed personified, this is a kill, unpardonable..

If you would have uttered any one of the above with a grand expression of surprise as soon as your credit card bill reached you, then you are not alone. The world is full of such people. And it is also full of those who make people say so.

But this is likely to end soon. Or at least that appears to be so.

43,500 customers of ANZ Bank in Australia have proceeded with a class action suit, the largest of its kind, demanding that USD 220 Mn levied as fees be returned to them.

These are some of the fees that are levied. Honor fee, Dishonor fee, Late Fee, Penalty and if some more greed cannot be hidden inside these, then you have the hidden clauses that no human mind on earth can decipher.

Look at some.

An honor fee is levied when an informal overdraft facility is exceeded. A dishonor fee is charged when a regular payment to another account cannot go through for lack of funds. And a late fee is charged if the payment is not made on time. So, more than one fee is charged for the same or related accounts.

Let us take another example. You have a credit card. Initially you get a fee waiver for two years. Then you go overseas and so don’t use the card. As a precaution you also cancel the card over a phone call. Then the third year starts and they levy you the annual charge. As you are overseas, you don’t know of this charge being levied. Then it enters into delinquency as you don’t pay the due. Are you responsible for the delinquency and the associated charges ?

And why do banks resort to these fees ? How come a single transaction is charged a fee twice ?

The answer, dear Watson, is greed and the need to recoup the losses due to the financial crises.

Coming back to the case. What are the implications for ANZ ? And for other banks ?

Did anybody say ‘bonus’ ?

 
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Posted by on December 12, 2013 in English Posts, Writers

 

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Aside

Mortgaging the country doesn’t mean squandering her wealth in overt and covert ways alone. Behind the facade of Modi-Rahul engagements and the sound bites accompanying these, there are different forces in action to silently siphon off the country’s wealth.

So the modus operandi is like this. Create as much din as possible to keep the media occupied and focussed on the din. For that create newer controversies invloving the popular folks so that the nation would be hooked to the media following these. And when the nation is not looking, make policy decisions in the back room and silently hand over the country to the vultures. This has been repeatedly happening for some time now.

Look at the following:

The whole of the country follows the Modi – Rahul spat. The English electronic media goes behind its normal business – going after rape incidents and similar such events and makes the people look in that direction. And the ‘National’ English media debates on whose catch phrase is better – Modis’ or Rahuls’ and also contains ‘erudite’ articles by left oriented leaders pontificating on the New Fatherland (China).

And the RBI makes an announcement of foreign banks in its order :

1. Issues directive to foreign banks in India to open zero balance accounts for retail customers under the guise of making banking accessible to rural folks.

2. Asks those foreign banks not to insist on minimum balances ( currently they are in the range of Rs 25,000 daily average )

So far so good. Having put up the appearance of being ‘stringent’ on foreign banks, they make the not-so-publicized announcements :

1. The global banks can open local head quartered subsidiaries.

“So what ?”, one might ask. But these “local” foreign banks, once established, can take over other local banks. And the RBI says this in a specific clause. This is reported in The Wall Street Journal Asia of 28-October-2013.

And the paper says that RBI has given the idea that the foreign banks could convert their existing Indian branches into local banks and over a period of time would be allowed to take over other Indian banks.

The RBI further has assured “near national treatment” to all these foreign banks.

So, in the near future, you could be seeing Barclays Bank in Usilampatti offering Crop Loans to dhothi-only clad farmers. And mind this – the loan officers would be the ultra modern girls operating out of air-conditioned branches.

And what if the farmer doesn’t pay his loan on time due to ,say a drought ? Send in anti-socials for debt collection ?

Better disband the RBI and outsource that function to the MAS ( Monetary Authority of Singapore ).

These guys are so watchful that they initiated audit of the loans that the Indian banks in Singapore provided to businesses when it was reported that the banks were slightly over leveraged in terms of the loans provided to some Indian companies about whom some adverse press reports had emerged. Such is the attention to detail that is used by MAS.

Another case in point is that the MAS does not allow expansion of foreign bank branches and ATMs like how it allows the country’s own banks DBS and OCBC. There is a strict cap on the number of branches that can be opened.

Either RBI learns its lessons or take help from MAS.

And the national media NDTV and CNN-IBN focus on Tendulkar’s retirement and Shilpa Shetty’s pregnancy while The Hindu speaks about the “rise of communalism” in the BJP ruled states.

Reserve Bank – outsource thyself

 
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Posted by on October 29, 2013 in English Posts, Writers

 

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Double trouble

Please sample the two mails received today. Nothing wrong with the content. All are in impeccable language. And there is no wrong intent.

The intentions are noble. One asks me for feedback while the other has apparently enabled my internet banking and wants me to use that.

But I have just one problem with these two mails. And the problem is – I don’t have an account with these two banks.


Dear Customer
,

We appreciate your relationship with our Bank. To serve you better is our motto.

On the occasion of our 10th Foundation Day on October 1, 2013, we solicit your feedback to further enrich your experience with us.

We value your time, but a few minutes of yours will enable us to gain deeper insights of your perception about our products and services. We assure you that your comments will be held in complete confidence and your contact details will not be shared with any other entity.

May we request you to kindly fill in the form through the link embedded in this mail.

Customer Care Centre Team,
IDBI Bank Ltd.

Click here to submit your feedback.

HDFC Bank Logo
Dear Customer,Thank You for banking with us.This is to inform you that your Customer Id has been enabled. You can now log into NetBanking with your Customer ID and IPIN (Password) and conduct a wide range of transactions.

Incase your have forgotten your NetBanking IPIN ( Password), please visit www.hdfcbank.com to re-generate the same online, realtime.

Please contact PhoneBanking or your nearest HDFC Bank Branch for any queries.

This is an auto generated mail. Please do not reply to this email.

Spend smart on your HDFC Bank cards with over 4000 offers.Know more

Take care of your loved ones. Ensure you have a nominee appointed for all your accounts including Lockers, Fixed Deposits and Savings Accounts.
      
 
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Posted by on October 4, 2013 in English Posts, Writers

 

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Banking banking no papa ..

The multi national banks of the world are burning in rightful indignation. How on earth could this be ever possible ? How come the world in general and India in particular come to this ?

How is this going to help the bourgeois ? lament the most capitalistic of banks . Would not the poorest of the poor be hit ? ask the very same super capitalist banks of the world.

Lobbies are activated. “Intellectuals” are interviewed and they profess the very same rightful indignation at the Indian government’s move.

The point that is bandied is that India’s governing bank the RBI has announced that four new private banks would start functioning in India. And that has set the world’s capitalists on fire.

And what are they worried about ? If new private banks are allowed to function they will not take the banks to the poor. They will cater to the rich. And lo and behold, they will be owned by Industrial houses which would lead to conflict of interest.

That is because the four players who are likely to get banking licences are the Birla Group, the Tatas, the Larsen and Toubro industrial conglomerate and probably the South India based T.V.S.group. Rumours are rife that Bajaj and Reliance would also be accorded licenses. And the mandate is that they need to open more rural branches as one out of two Indians don’t have a bank account.

So what is the harm ? Don’t Indian’s need more banking ? Why are the capitalist New York based banks worried ?

The worry is – these Industrial houses, if they are allowed to open a bank, would manipulate their own credit ratings and lend their own companies less expensive loans. For example, Reliance, known for its ‘scrupulous’ practices, would accord a better credit rating to itself and lend itself a better loan than if it had to borrow from say Bank of America or J.P.Morgan Chase.

It is true that this is a possibility. We know what Reliance is capable of doing.

But how does it worry the JP.Morgans and the others ? Were they not having banking licenses in India earlier ? They had. But they were not interested in serving the rural India. They wanted to target the corporate rich and get away with the cream. Now that these corporates are allowed to have their own banks, this creamy business is lost.

And so they cry. The baby never cries when it is not hungry.

 
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Posted by on July 14, 2013 in English Posts, Writers

 

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