Five financial changes to look for in 2022


The year 2022 could bring good news to savers. At the same time, costs for some of the bank customers who deal primarily in cash may increase. There will be new technologies that will secure your online transactions. Here are some of the changes that will take place in 2022.

Interest rate

Real savers’ returns have been negative for more than two years, with interest rates kept low since the start of the pandemic. In fiscal year 2020-2021, average inflation based on consumer prices was 6.22% and for the current fiscal year it is expected to be around 6%. On the other hand, the peak fixed deposit rates offered by banks are around 5-5.5 percent.

At the same time, mortgage interest rates are at their lowest for several decades, as many lenders charge less than 6.5%.

2022 could see interest rates start to reverse the trend. Because the Reserve Bank of India (RBI) is unwinding the ultra-accommodative monetary policy in force for two years. Liquidity has tightened, causing interest rates to rise at the shorter end of the curve.

The State Bank of India – the country’s largest lender – raised its key rate by 10 basis points in December. The base rate is the old benchmark lending rate, to which all other rates were linked. Although an increase in the base rate will only affect a few clients who are still in this regime, the indication is clear. Interest rates have bottomed out. They will only go up from now on.

Higher ATM fees

From January 1, customers will be charged Rs 21, compared to Rs 20 previously, for ATM transactions, beyond free transactions.

Customers are entitled to five free transactions (including financial and non-financial transactions) each month from their own ATMs. They are also eligible for free transactions (including financial and non-financial transactions) from other ATMs – three transactions in metropolitan centers and five transactions in non-metropolitan centers. Beyond free transactions, customers will now be billed at Rs 21 per transaction.

One way to mitigate rising fees is to increase reliance on digital payment methods.

File Tokenization Card

To secure online transactions using debit or credit cards, Reserve Bank of India has only allowed card issuing banks and card networks like Mastercard, Visa, Rupay and others to store the data. cards. All other entities in the payment chain will need to purge all previously stored data.

RBI had observed that the availability of card details from a large number of merchants greatly increases the risk of card data theft.

Tokenization is the process of replacing debit and credit card numbers with a set of characters or tokens. This is mainly done to secure the payment process. Tokenization is currently performed for free by payment aggregators.

RBI has enabled card issuers to offer card tokenization services as token service providers (TSPs). Tokenization of card data must be done with the explicit consent of the customer requiring an additional authentication factor (AFA).

The deadline to comply with the standards was December 31, 2021. Following requests from industry players, the deadline has been extended by six months, until June 30, 2021.

Stricter NBFC standards

With shadow banks having recorded robust growth in recent years, the banking regulator has now decided to tighten supervisory standards for non-bank financial companies.

“NBFCs have grown in size and have a substantial interconnection with other segments of the financial system,” RBI said while offering early remedies for non-bank financial corporations, in line with commercial banks.

NBFCs will now face restrictions on certain activities such as branch expansion, capital spending, dividend distribution if these entities exceed certain thresholds relating to capital, bad debts and leverage. The PCA standards will be applicable to all NBFCs accepting deposits (excluding government-owned ones) and to all NBFCs not accepting deposits in the “middle, top and top layers,” RBI had said. .

The CPA framework for NBFCs will come into effect on October 1, 2022, based on the financial position on or after March 31, 2022.

New locker standards

Bank locker standards have been revised by the banking regulator Reserve Bank of India, which was long overdue.

First, the entire locker allocation process has been made transparent, as banks have been asked to maintain a list of vacant lockers per branch as well as a waiting list for locker allocation purposes.

In addition, RBI said that banks are responsible for taking all measures for the safety and security of the premises in which the safes are located.

Banks will have to pay the customer one hundred times the annual rent of the locker, to the customer in case of loss of the contents of the locker due to theft, robbery or fraud committed by its employees. The new standards came into effect on January 1, 2022.

(The writer is a Mumbai-based journalist)

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