Rush to spend old notes spawns new exchange business

http://www.mumbaimirror.com/mumbai/cover-story/Rush-to-spend-old-notes-spawns-new-exchange-business/articleshow/29319590.cms

 

Trust enterprising Mumbaiites to turn an adversity into a business opportunity. 

The Reserve Bank of India's decision to withdraw pre-2005 currency notes has spawned a new exchange trade in the city, involving replacement of old notes with new ones for a commission of 2 per cent. 

Despite the RBI's clarification that pre-2005 notes will remain legal tender post March 31, the central bank's deadline for withdrawing these notes from circulation, the decision has set off panic in the city and small businesses have begun reporting receiving large number of these notes. 

While the RBI has made it clear that anybody can walk into a bank and exchange pre-2005 currency notes for new ones, not many Mumbaiites took up the offer on Thursday and Friday, fearing it could set the Income Tax department after them. 

Though the RBI has not mentioned any date beyond which pre-2005 currency notes will become worthless, people believe this will happen sooner than later. 

Sauji Bachhu Patel, manager-cum-cashier at Daily Needs, a super market on Palm Beach Road, Nerul, said he asked his staff to start separating pre-2005 currency notes in the store's daily collection on Thursday. "I was surprised by the amount of pre-2005 notes in the day's collection. It's clear that people have started dumping old notes at retail outlets," he said. 

Narendra Singh, owner of Blue Star Wines, Santa Cruz, too received a large number of pre-2005 notes on Thursday and the trend continued on Friday. "I am sure it's going to become a deluge by Monday," he said. 

The buzz in the exchange trade on Friday was that the commission for exchanging pre-2005 notes could double by next month to 4 per cent and touch 10 per cent in March. 

RBI Governor Raghuram Rajan at a lecture in New Delhi on Thursday said there are security factors attached to the decision, which had nothing to do with the elections. According to RBI sources, the pre-2005 notes have fewer security features and thus their copies are easier to produce. 

While currently one can walk into a bank and exchange any amount of pre-2005 notes, from July 1, to exchange more than 10 pieces of Rs 500 and 1000 notes, non-customers will have to furnish proof of identity and residence to the bank branch in which the exchange will take place. 

SBI launches Youtube channel; Twitter is next

http://www.thehindubusinessline.com/companies/sbi-launches-youtube-channel-twitter-is-next/article5609936.ece

Nation’s largest lender State Bank of India on Thursday strengthened its social media presence with the launch of its channel on popular video sharing website Youtube and said it will also be launching its handle on the micro-logging site Twitter soon.

“The YouTube channel is another platform that will enable us to connect with our customers. SBI will continue to spread its footprint on social media through the launch of platforms like Twitter, shortly,” Chairperson Arundhati Bhattacharya said in a statement.

The YouTube channel, which follows a dedicated Facebook page launch in November, will initially have information about the bank’s products and services and its legacy to begin with and will gradually include philanthropic initiatives, it said in a statement.

SBI, has over 200 years of history. It has over 15,000 branches and over 43,000 ATMs.

The bank statement said the Youtube channel will help it connect with the young and technologically savvy customers.

9,000% dividend! Record payout from TMB

http://www.thehindubusinessline.com/industry-and-economy/banking/9000-dividend-record-payout-from-tmb/article5602547.ece

Tamilnad Mercantile Bank (TMB) has declared an interim dividend of 9,000 per cent. 

That’s actually Rs 900 per share of Rs 10 each, for the fiscal ending March 2014.

The board of this Tuticorin-headquartered bank took a decision to this effect at a meeting held on January 18.

Bank sources said this would translate into an outgo of Rs 25.6 crore (unchanged from last year).

The 9,000 per cent interim dividend is said to be the highest in the banking industry and this is the second year in a row that the bank has declared such a high dividend. It may be recalled that the bank’s board had approved a dividend of Rs 750 per share for 2008-09 and Rs 1,000 per share the following year, but could not make the payment as the annual general meetings for 2009-10 and 2010-11 were not held due to legal issues.

Bank sources said TMB’s shares continue to trade at between Rs 60,000 and Rs 65,000 a share in the informal market.

Banknotes issued prior to 2005 to be withdrawn: RBI Advisory

The Reserve Bank of India has today advised that after March 31, 2014, it will completely withdraw from circulation all banknotes issued prior to 2005. 

From April 1, 2014, the public will be required to approach banks for exchanging these notes. Banks will provide exchange facility for these notes until further communication. 

The Reserve Bank further stated that public can easily identify the notes to be withdrawn as the notes issued before 2005 do not have on them the year of printing on the reverse side.

The Reserve Bank has also clarified that the notes issued before 2005 will continue to be legal tender. 

This would mean that banks are required to exchange the notes for their customers as well as for non-customers. From July 01, 2014, however,  to exchange more than 10 pieces of `500 and `1000 notes, non-customers will have to furnish proof of identity and residence to the bank branch in which she/he wants to exchange the notes.

The Reserve Bank has appealed to the public not to panic. They are requested to actively co-operate in the withdrawal process.