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Energizing Digital Lending for Msmes Vol. 16 No. 2 June 2017 `75 Pages 56 Iranian banking Addressing NPAs AfDB annual meeting Utkarsh Small Finance Bank www.bankingfrontiers.com Energizing digital lending for MSMEs CA Abhay Bhutada Managing Director, TAB Capital Editor’s Blog Manoj Agrawal Mobile : 98673 66111 Email : [email protected] June 2017 - Vol. 16 No. 2 Group Publisher : Babu Nair Group Editor : Manoj Agrawal Banks, Robbers & Thieves Editor : N. Mohan wo news items caught my attention today (June 13). In Mumbai, a gang of thieves drilled a hole into the wall of a jewelry store and stole jewelry and cash valued Editorial Tat about `31 lakh. The gang had hired the adjacent shop and were doing a Mehul Dani, Ravi Lalwani, business of selling mangoes. V. Raghuraman, Surekha Galagoda The news report said that they were keeping a close watch on Research Editors the jewelry store and discovered Prof Venugopal Iyengar, V. Babu, that the surveillance camera had Ratnakar Deole, W.A. Wijewardena, stopped functioning. That is when Sanchit Gogia, K.C. Shashidhar, they made their strike. The KYC L.S. Subramanian, Ajay Kumar papers they had submitted to rent Advisor-Alliances the shop were apparently fake. Ateeq Siddique The other news item in today’s newspaper is that thieves broke Marketing into the strong room of PNB branch in Modi Nagar in UP. Here too the modus operandi Zahid Siddique, Arun D’Souza was to make a hole in the wall. The thieves broke up 30 safe lockers. Obviously, the Events & Operations customers who had rented those lockers were very angry. Gautam Magare, Shirish Joshi, Is breaking walls the new tactic of thieves? Typical of any place of value is that Stalin Saldhana, Pramod Jadhav, 5 out of 6 sides are walls/floor/ceiling. This gives the impression that only the open Amit Gupta, Bharat Solanki, side needs to be guarded and that is why we have security guards outside branches Shweta Kadam, Durgesh Nadkarni, and ATMs. Ashish Verma Bank looters have 2 methodologies - by force and by stealth. In the former Design methodology, the miscreants, termed as robbers, come in with guns during daytime, Somnath Roy Choudhury take hostages and forcibly take cash and valuables. In the latter methodology, the miscreants, termed as thieves, come in stealthily, typically at night avoiding the main Published By entrance to steal valuables. Glocal Strategies & Services Thanks to news and movies, there is a greater consciousness about forcible attacks. D-312, Twin Arcade, Military Road, Marol, There is a new movie coming named ‘Bank Chor’, which will further reinforce this Andheri (E), Mumbai 400059, India. thinking. However, the trend is that criminals are increasingly preferring to operate by Tel: +91-22-29250166 / 29255569 stealth rather than by brute force. Fax: +91-22-29207563 Most bank security chiefs come from the army background and I assume that their primary training is oriented towards action. If we look at our borders, there is increasing Printed & Published by Babu Nair on behalf of Glocal Strategies & Services and activity in stealth mode than in action mode. This is not just for India, but across the Printed at Indigo Presss (India) Pvt Ltd., world. I see stealth attacks as the dominant threat vector all across the world. I do look Plot No. 1C/716, Off Dadoji Konddeo Cross forward to bank security chiefs upgrading their strategy to effectively handle both Road, Between Sussex and Retiwala Indl. kinds of threats. Estate, Byculla (E), Mumbai 400027. I also hope that start-ups look at this opportunity and bring in innovative ideas, particularly suited to the Indian scenario. One small suggestion I have is that government Editor: N. Mohan (Responsible for selection should make it mandatory that whenever a tenant is being registered, his bank details of news under PRB Act) should be captured and verified. This itself could be an additional deterrent. Banking Frontiers June 2017 3 N E W S Regulators RBI advertises for deputy governor Brazil to regulate fintechs The Reserve Bank of India has released an advertisement The Central Bank of Brazil may enact new calling for applications for the regulations to oversee and assist fintech position of a deputy governor. firms across the country. Director the bank This is for the first time that an Otavio Damaso said increased innovation advertisement has been issued and a growing number of fintechs are all in newspapers for the position. very positive for the efficiency of Brazil’s The advertisement said the financial system. At present, fintechs firms central bank needs candidates have only a small share of Brazilian banking, with over 15 years of experience but they have been making good headway in banking and financial market with credit cards and consumer lending. operations. Besides, they should Damaso said the proposed regulations also be whole-time directors or board members. The selected candidate will be would pave the way for development of the replacing S.S. Mundra whose term will be ending in July 2017. The advertisement does fintechs within a secure judicial framework. not specify whether the candidate should be from the public sector or private sector The new rules would cover fintechs teaming banks. The advertisement also specifies that the applicant should have an appreciation, up with banks to offer loans, those providing as a practitioner, of the role of banks in large corporate lending, in an environment with securitised credit from institutional strong bond markets is desirable, besides seeking an understanding of bankruptcy/ investors, and peer to peer lenders. restructuring/turn-around/credit models, and/or overseen the risk management function in a large financial institution. The appointment is for a period of three years initially and the selected person is eligible for re-appointment. The central bank has Sweden invalidates already announced it is intending to have a chief financial officer. 3 old coins China mulls regulating fintech sector The People’s Bank of China (PBoC) has set up a new fintech committee to augment future regulations and policies surrounding this sector. PBoC is expected to undertake an in-depth study on the impact of financial and technological development on monetary policy, financial market, financial stability and payment and settlement and do well the strategic planning and policy guidance for China’s financial and technological development. The central bank believes that the introduction of an innovative fintech apparatus will strengthen exchanges and facilitate further cooperation at home and aboard. The regulator is willing to join hands with those in the ecosystem and work together in order to promote a functional and healthy fintech industry. Palestine to have digital currency The Sveriges Riksbank, Sweden’s monetary Palestine Monetary Authority is mulling creating of its own digital currency. Azzam regulator, has invalidated use of three Shawwa, head of the authority said the regulator is weighing a bitcoin-style solution to denomonations of coins in the country. its lack of a central currency. Palestine uses a mix of US dollars, euros and other regional It said older 1-, 2- and 5-krona coins will currencies. Apparently the regulator does not have the infrastructure and conveniences no longer be accepted in circulation after to issue its own currency, due to the agreement that led to its establishment. Shawwa said 1 June. They will remain legal tender until the new currency will be called the Palestinian pound. He suggested it might be backed 31 August, but may only be deposited into by some kind of commodity, mentioning ‘reserves, gold, oil’ as possible assets to underlie bank accounts. In 2016, new coins of the the currency. The authority is keen to have the new currency in the next five years. three denominations debuted with new designs and different alloys. The designs Hong Kong may use facial recognition technology are based on the theme Sun, Wind and The Hong Kong Monetary Authority is examining whether facial recognition or Water. The bank is now withdrawing older fingerprint technology can be used in cash machines to beef up financial security. It versions of these coins. The old 1-krona wants to make sure this technology is reliable and useful. HKMA chairman Norman coins were in use from 1976 to 2012, with Chan Tak-lam said Macau has adopted this new technology and Hong Kong will study several circulating commemorative designs to see if this can enhance security. Official figures showed that the number of suspicious in use. Two different types were in use transaction reports received by the police tose from 23,282 in 2012 to 76,590 in 2016. during this period, with the most recent Macau announced the move to use facial recognition to scan bank card users at ATMs definitive design used from 2001 to 2012. to tackle money laundering and capital flight. The high-tech screening system will first The 2-krona coin had not been issued for be installed at ATMs in and around casinos before being extended to cover all 1300 circulation since 1971. The classic 5-krona cash machines. coin has been issued since 1976. Banking Frontiers June 2017 5 Project Pipeline IDBI Bank to implement turnaround plan BoB to have mobile IDBI Bank is going to engage a consultant device solution to advise it on Bank of Baroda is intending to set up a mobile sustainable growth device management system in the bank and profitability. The primarily to enhance mobile security. The bank is exploring key objectives in implementing the system avenues to identify include providing a secure mechanism for areas and strategies the bank’s corporate (in-house developed) for cost containment commercial applications used on a variety and revenue of mobile devices and platforms, providing maximization leading context segregation between corporate and to sustainable growth end-user personal contexts, implementing and profitability BYOD feature, implementing full kiosk and it intends to mode for selected set of corporate formulate a strategic owned devices and integrating with program to focus on directory services.
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